Government Response to RHI Consultation

Posted in: bioenergy

BEIS has published its response to Chapter 2 of the September 2017 RHI consultation, clarifying eligible uses for renewable heat.

The Department for Business, Energy & Industrial Strategy has published (29th January) the Government's response to chapter 2 of the September 2017 RHI consultation, which relates to the definition of eligible heat within the Non Domestic Renewable Heat Incentive.

In the September 2017 consultation on proposed amendment to the scheme,  the Government made a number of proposals to tighten the rules relating to eligible uses for heat, including the proposal to remove all drying practices as an eligible heat use for new participants. In summary in response to consultation the Government rather than introduce a blanket ban on drying practices has decided to:

  • remove wood-fuel drying as an eligible heat use other than where the renewable heat installation is replacing a pre-existing fossil fuel heat source. A transition period will be included to allow wood-fuel drying plant that are in development to be accredited;
  • remove the drying, cleaning or processing of waste as an eligible heat use;

Additionally, the Government will amend RHI scheme rules so that installations where heat is produced predominantly for a single domestic premises will no longer be eligible under the Non-domestic RHI.  These changes will apply to new participants or existing participants who add capacity on or after the date the reforms come into effect.

The government will consider further evidence to ensure uses for heat are genuine and economically justifiable with a view to introducing further possible changes in future. Support for crop drying and use of heat in aquaculture remains. Drying of digestate will also no longer be permitted as an eligible use of heat, as announced in reforms to the RHI outlined in December 2016.

The Government intends to implement these eligible heat use changes alongside the implementation of the remainder of the RHI reforms announced in December 2016.  This is currently anticipated for spring 2018.

David Turley, Head of Feedstocks at NNFCC comments, "This outcome is pretty much in line with expectations, but the announcement is welcome in providing clarity to potential project developers, as well as the position taken not to ban all drying operations outright, but consider individual uses on merit."

The Government's response to the consultation can be found here.