Installers need to get up to speed on the rules of the Renewable Heat Incentive (RHI) to ensure new and existing customers aren’t left out of pocket when the scheme is introduced in the spring, says Simon Osborne, head of product and channel management at Baxi.
In December 2013, the Department for Energy and Climate Change (DECC) published further details of the domestic RHI, outlining the tariffs available and the criteria for those eligible for payments.
As expected, DECC has included a provision for legacy applications. This means that homeowners who have had a biomass boiler, air source heat pump, ground source heat pump or solar thermal system installed since 15 July, 2009 may still be able to claim for payments under the scheme. These customers will need to act fast though, as legacy applications will only be accepted in the first year of the scheme – thereafter, only new installations will qualify.
For installers who have fitted qualifying products since July 2009, it is worth contacting past customers to ensure they are aware of the new RHI scheme and to offer some further information, so they have the opportunity to sign up before the 12-month deadline expires.
The scheme will be accepting applications from people whose installations were not part-funded by the Renewable Heat Premium Payment first, followed by applications from part-funded installations three months later (a voucher must have been applied before 20 May, 2013) and finally all legacy applicants will be eligible to apply from autumn 2014.
After the scheme goes live in the spring, it will be crucial that installers give their new customers information about the RHI in a timely way. Applications for technologies installed after the launch date must be submitted within a year of commissioning otherwise those homeowners will miss out. This could cause major issues if the installer has presented an affordability case for a renewable heating solution including the guarantee of payments secured through the RHI.
And it’s not just the 12-month deadline that installers need to be aware of as the RHI tariffs could actually drop from one quarter to the next as part of measures to ensure the government scheme stays within budget.
The so-called digression policy only affects new customers, and means that DECC will drop the tariff by 10% if a ‘trigger’ figure for the number of applications received for a particular heating technology is reached. If the jump is significant enough to hit a ‘super trigger’ number of applications, the tariff drops by 20%. This drop in tariff could have a significant effect on homeowner budgets and the new price p/kW could be significantly lower than the numbers initially presented by the installer.
Installers can give prospective customers advanced warning of when tariff decreases, which may be imminent by proactively checking the monthly updates of progress towards the triggers that will be published on the gov.uk website.
The RHI is great news for people who have already made the move to renewable heating and will provide additional incentives for those considering it. However, for the scheme to work in practice, installers must effectively become energy advisors to customers to ensure they are reaping the rewards of the RHI and not being left out in the cold.