There are two key areas the government should consider in the Renewable Heat Incentive review
The Renewable Heat Incentive (RHI) has been with us since 2011 and provides payments for applicable heat generated from biomass, heat pumps (HP), solar hot water (SHW), and anaerobic digestion. The GB one differs from the Northern Ireland one, which has been so prominent in the media this year.
The RHI created a booming market for biomass heating, but less so for the other technologies; around 83% of heat generated under the RHI has been from biomass. Whilst this is positive, more needs to be done as currently we are set to miss our target of 12% of heat from renewables in 2020.
With the RHI providing each technology a similar return there should be broadly similar amounts of investment going to each technology. So why the discrepancy?
In most cases biomass heating systems can use existing heat emitters and operate at the same temperatures; essentially you can bring them to site and plug them in, even maintaining the old system as back-up
Put simply, HPs and to a lesser extent SHW systems are a more complex retrofit. In most cases biomass heating systems can use existing heat emitters and operate at the same temperatures; essentially you can bring them to site and plug them in, even maintaining the old system as back-up. This simplicity has brought a great number of suppliers/developers/investors together to establish an efficient and effective supply chain, particularly in the supply of heating systems that are free to end users with investments recouped from the RHI, and payments for the heat by the end user.
With HPs and SHW more careful analysis is required, as well as adjustment or replacement of the heat emitters and changes to the building fabric. The performance of HP/SHW systems is also much more sensitive to design and installation quality than biomass. Essentially the point is, these systems are more complex and lack a standardised approach the market can get behind - hampering investment.
The government is aware of the issue and have announced a revision to the RHI. The proposals include updating the tariffs for each technology, and some other small tweaks, but with regard to the issue of HPs and SHW systems there is good news. Both will continue to be subsidised (which wasn’t always the plan for SHW), and industry design/installation skills will be supported. We will also be encouraged to monitor performance through electric and heat meters, and so should learn what is and isn’t working.
There are two big ways government/investors could help:
- Through a large-scale retrofit/research programme, perhaps partnering with the public sector and/or housing associations. This would enable an efficient supply chain, with trained installers, to be developed, and allow for the sharing of good practice and research across the industry. (Peter Bonfield has already called for a quality mark for energy efficiency/renewables work in homes.)
- By requiring that the 14 new garden villages/towns are built with HP/SHW system technology we would generate a supply chain able to transfer to the retrofit market easily in the future. On new developments HPs are a no-brainer in terms of air quality, CO2 emissions and customer bills but they are rarely installed because of developer inertia and the up-front cost.
The combination of these two measures would go a long way to developing the supply chain and skills required in this important area.
Barny Evans is environmental associate director for WSP | Parsons Brinckerhoff