UK nondomestic RHI reaches 1 GW wood heat, $1.26 billion invested

By Anna Simet | August 21, 2014

The U.K. Renewable Energy Association and Wood Heat Association are reporting a milestone has been reached under the country’s nondomestic Renewable Heating Incentive.

The RHI is a U.K. government environmental program that provides financial incentives to increase the production and use of renewable heat, and includes separate programs for the domestic and nondomestic sectors. For the nondomestic sector, it provides a subsidy, payable for 20 years, to eligible, nondomestic renewable heat generators and producers of biomethane for injection based in the country.

According to the associations, as of Aug. 15, 1 gigawatt of renewable heat is being generated in the commercial, industrial and public sectors, with 4,926 accredited wood heating installations at locations including farms, factories, care homes, hotels and churches.

DECC defines an accredited installation as a system that has submitted an application and has gone through full checks by program administrator Ofgem’s E-serve to make sure that it complies with the relevant conditions.

The RHI has had a significant impact on investments in renewable heat—particularly bioenergy—and those investments are forecasted to significantly increase over the next several years. DECC statistics indicate that between 2010 and 2012, £760 million ($1.26 billion) was invested in heat from bioenergy, or 56 percent of the total investment in renewable heat over the period. That share is expected to increase to 85 percent from 2013 to 2020.

Julian Morgan-Jones, interim chairman of the newly launched Wood Heat Association, said 1 GY of wood heating under the RHI is “a major breakthrough. Our industry is growing fast, from boiler manufacturers and installers to fuel producers and distributors. We want that growth to be both successful and sustainable.”

Morgan-Jones added that a s well as stability in the RHI, more work needs to be done on upskilling system installers and developing widely accepted installation standards for all boiler sizes.