Ground source heat pump RHI tariffs under review

By Katie Anderson on February 5th, 2013

The Ground Source Heat Pump Association (GSHPA) is celebrating after the Department of Energy and Climate Change announced it would be conducting a review of the Renewable Heat Incentive tariffs for the renewable energy heat pumps

Addressing concerns over the Renewable Heat Incentive (RHI) and distortion in the tariffs’ payment structure, particularly the low tariffs applied to non-domestic ground source heat pumps, GSHPA put forward evidence which would support a revised rate of 9.4p/kWh. Greg Barker, the Minister of State for Climate Change has instructed the DECC’s RHI team to expedite the review in response.

In a statement DECC addressed the issues and acknowledge that there was a need to revisit early assumptions, stating “evidence suggests there may be differences between actual costs and load factors of installations and the original assumptions used to calculate the current tariffs”.

A group representing the GSHPA met up with Greg Barker and DECC in December and it was determined that an in-depth review was indeed necessary, which would be carried out by a group of civil servants operating in DECC’s RHI team.

To back up their concerns, the GSHPA revealed that just 2% of RHI payments had been made to heat pump owners. During the first year of the RHI the number of heat pumps installations was much lower than had been anticipated. With 98% biomass has been far and away the technology of choice to date under the RHI.

Brian Kennelly, chairman of the GSHPA said:”It’s been a tough time for the GSHP industry but the great news is that the DECC has recognised the omissions in the data and is revisiting the tariff levels so that this low-carbon technology can flourish and so significantly improve Britain’s environmental credentials.”

The tariff rates for the domestic side of the scheme have yet to be announced, although back in September DECC offered a first glimpse of the proposed RHI rates.

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