Decarbonising heat is vital if emissions reductions targets are to be met. The Non-Domestic Renewable Heat Incentive (NDRHI) was introduced to support the deployment of renewable, low carbon sources of heat to businesses, public bodies and charities.
In November 2011, the NDRHI scheme was launched offering financial support for the installation of eligible renewable heating systems. The NDRHI has been open to renewable heat installations that provide heat to buildings and for purposes other than heating a single domestic property, which are eligible for the Domestic Renewable Heat Incentive Scheme. This includes, for example, systems providing renewable heating to public buildings or commercial properties, generating heat for industrial or agricultural purposes, or for heating multiple domestic properties.
A range of technologies are eligible for support under the NDRHI, include biomass boilers; air source, water source and ground source heat pumps; solar thermal systems; deep-geothermal; biogas-combustion systems; combined heat and power (CHP) systems using a range of renewable fuels and sources, and; the production of biomethane for injection into the gas-grid. As of January 2020, the NDRHI has helped to produce a total of 42,400 GWh of renewable heat. There have been a total of over 1,800 ground, water and air source heat pumps accredited to the NDRHI, accounting for approximately 180MW of installed capacity.
With the exception of domestic properties with individual heat pumps connecting to a shared ground loop, participants accredited to the NDRHI receive payments over a 20-year period based on the heat output in kilowatt hours (kWh) of the system. Producers of biomethane are paid based on how much biomethane is injected into the gas grid. In order to receive payments, participants and producers accredited to the NDRHI must continue to satisfy the eligibility criteria and ongoing obligations contained within the regulations.
The NDRHI scheme will close to new applications from midnight 31st March 2021. As the scheme is closing, there will be no new policy initiatives with regard to eligibility so the focus of the consultation is on scheme design and operational changes aimed at future-proofing the NDRHI by making the scheme easier to administer and participate in, while ensuring protection for participants from any undue adverse effects post-scheme closure.
These reforms seek to:
- future-proof the NDRHI scheme following closure and continue to maximise the contribution the NDRHI makes to the decarbonisation of heating in the UK;
- improve the experience for participation in the scheme;
- ensure robust management of the scheme for the remainder of the payment term;
- deliver ongoing value for money to the taxpayer.
The government is seeking views on the proposals outlined in the consultation. Many questions relate to specific technologies supported by the scheme and are aimed at participants. We are particularly focussing our feedback on the following two questions:
- Do you agree or disagree with the proposal to close the Non-Domestic RHI from 31st March 2021?
- Are there any specific changes you would like to see introduced to the scheme to account for future technological change?
The consultation closes on 7th July 2020. We are formulating our response to the consultation and would welcome your feedback to incorporate into this. To have your say, please email the compliance team at compliance@carbonxgen.com or to discuss this further please call Melanie Kendall-Reid on 01252 87 87 22.