The sun is set to shine on homeowners who install heat-generating renewables. Tim Pullen explains.
For those that have not been keeping up, the RHI is similar to Feed-in Tariffs in that it is a quarterly payment from the Government for every unit (kWh) of heat energy produced from a renewable source and it applies at different rates to heat pumps, biomass boilers and solar thermal.
It is only the renewable element that’s paid for. So, for a wood pellet boiler (biomass) producing 20,000kWh of heat, the owner will be paid for 20,000kWh. For a heat pump producing 20,000kWh, the owner will be paid for 20,000kWh less the electrical input.
We’ve worked up some examples of how it might work in certain situations.
How it works
|The Standard||The Eco||The Barn|
|Build Standard||Building Regulation||Code for Sustainable Homes Level 4||some effort to reduce energy consumption with constraints imposed by a stone barn|
|Space Heating Demand||11,000kWh||7,000kWh||15,000kWh|
|Domestic Hot Water (DHW) Demand Per Year||4,000kWh||4,000kWh||5,000kWh|
|Running Cost on Oil Per Year||£1,000||£830||£830|
|Heating Systems Installed||
|Total Capital Cost||£12-14,000||£6-7,000||£10-15,000|
|Running Cost on Renewable System for Heating and DHW x 7 Years||£4,480||£3,185||£4,270|
|Total Benefit over 7 Years||£19,698.62||£8,836.27||£21,350|
* value after Coefficient of Performance (CoP) is factored in. For more information on CoP read Heat Pumps: A Guide
Our Conclusion: It Makes Good Sense
The RHI gives a return that broadly pays for a system in seven years. In all cases, running costs are lower than the fossil-fuelled alternative.
It’s important to remember too that gas and oil boilers tend to have a life of 10 to 12 years, but heat pumps and biomass boilers tend to last 20 years or more — solar panels, 30 years plus. So for at least 13 years, the owner is ‘in profit’ with a system that has, by then, cost nothing (potential maintenance costs aside).
The rates announced may not be as good or for not as long as we had hoped, but they are better than we were beginning to believe, and good enough to ensure that installing renewable heating systems makes good financial (as well as ecological) sense — and that it is a sensible option for anyone building or renovating.
Main image by Oliver Dixon.