The Renewable Heat Incentive (RHI) is a scheme designed to financially reward those who use renewable energy to heat their homes.
There are two Renewable Heat Incentives (RHI): one for residential homes and one for the non-domestic sector (industrial, commercial, public sector and community organisations). The overall aim of the RHI scheme is to help the UK achieve its target of producing 12% of its heat from renewable sources by 2020. The scheme runs in England, Scotland and Wales.
The domestic part of the RHI scheme launched on 9 April 2014. It offers regular ‘tariff’ payments to those using certain technologies to heat their homes. The amount of money you get paid depends on which technology you use – you can find out more about how much you could potentially earn by reading our page on RHI costs and earnings.
Unlike the feed-in tariff, which is designed to provide income for households, RHI payments are meant to help offset the cost of installing and running a renewable heating system.
How do the Renewable Heat Incentive (RHI) payments work?
After joining the RHI scheme, you receive a quarterly tariff payment for every kilowatt hour (kWh) of renewable heat you produce. You get these payments for seven years. It’s possible for households to install more than one technology and receive payments for each system they use.
Energy regulator Ofgem is responsible for dealing with RHI applications and payments – click to find out more about how to apply for RHI.
Take a look at our gallery, below, to find out more about how air source heat pumps, ground source heat pumps, biomass boilers and solar thermal panels work.
RHI technology explained
Your payment amount will be estimated, based on your home’s Energy Performance Certificate (EPC) rating.
You’re most likely to benefit from the domestic RHI scheme if your home is off the gas grid and you replace your current heating system with a renewable one.
You can find out more about renewable air source heat pump technologies – including how to determine whether your home will be suitable to install – in our dedicated guides:
Changes to the RHI
RHI applicants used to have to get a Green Deal Assessment, but you’ve not needed one since April 2016. You now only require a valid EPC.
RHI payments for applications from April 2016 are adjusted annually in line with the Consumer Price Index (CPI). If you were a member of the RHI scheme before this, your tariff adjustments will continue to be linked to the Retail Price Index (RPI).
Reforms to the RHI increased subsidies for heat pumps and biomass boilers from September 2017. Solar thermal panels continued to be part of the scheme but with no tariff increase.
The government also announced ‘heat demand limits’ for heat pumps and biomass boilers, which will cap the amount of renewable heat for which households can receive RHI payments. Heat pumps installed from spring/summer 2017 onwards also need to have electricity meters fitted to help consumers make the most efficient use of them.