Homeowners, self-builders, landlords and local authorities can get cash incentives as part of a Government scheme.
As part of the drive to install one million air source heat pumps in UK homes before 2030, the Government is offering some great cash incentives.
The Green Homes Grant is in place for homeowners or residential landlords to make energy improvements to their home. The scheme is in place until 31 March 2022. Vouchers will cover two thirds of the cost of the eligible improvement up to a maximum government contribution of £5,000. If you, or someone in your household, receive certain benefits you may be eligible for a voucher covering 100% of the cost of the improvements. The maximum value of the voucher is £10,000.
On top of the Green Homes Grant there is the Renewable Heat Incentive Scheme (RHI), set up by the a UK government, administered by Ofgem to promote usage of renewable heat technologies. There are two schemes, the domestic and non-domestic scheme. The RHI covers specific renewable technologies including Air Source Heat Pumps, and provides Home owners and businesses a generous financial incentive for adopting these environmentally friendly renewable technology. The RHI is payable quarterly for seven years to homeowners, self-builders, private landlords and local authorities. These are paid quarterly for seven years to encourage uptake.
The Current RHI scheme is only confirmed in until 2021 and it is not currently known what the position will be for installations after this date. So now is the ideal time to install with the current generous cash incentive. Any amount received under the Green Homes Grant are reduced from the RHI payable. So for example if £11,000 was receivable under the RHI and a Green Homes Grant payment of £5,000 was due then the remaining £6,000 will be payable under the RHI.
Homes that are not currently connected to the national gas grid, which is estimated at in excess of more than 3.6 million in England and Wales are ideal for this initiative. These properties, currently using, oil, coal and electric heating are very expensive to heat and have higher carbon emissions. This means they have the highest potential to help the Government meet the reduced carbon emissions target. These properties also have the largest potential for financial savings by changing to renewable technology.
The Domestic RHI is ideal for retrofit properties as well as new self-build properties. For an average 3 bed family home, in the UK needing 15,000 KWH per annum, the total RHI payment received could be in excess of £9,500.
The RHI incentive is not available for new build properties, but with the upcoming current planned legislation the way we heat, build and power homes will have to change. From 2025 the Government intends to ban carbon based central heating systems (including gas), therefore the New Build property sector in particular new home developers, will need to also adopt renewable technologies. The committee on Climate change has indicated that by 2030 2.5 million heat pumps should be installed in UK new homes.
How to apply for the Renewable Heat Incentive Scheme
The Government requires a domestic Energy Performance Certificate (EPC) which is less than 24 months old and the installation must have been carried out by a Microgeneration Certification Scheme (MCS) accredited engineer.
Applicants must own or occupy the property where the technology has been installed.
Our packages include support on the application to the Renewable Heat Incentive Scheme which you must complete to get the invaluable RHI. If you need to renew your EPC, then this will cost approximately £60 to £120 but we can include this in your installation package.
You have 12 months to apply after the installation is complete and your technology with also be the Registered on the MCS database. Ofgem administers the scheme and further information can be accessed here.
Source:Energy Saving Trust Website
To find out more, there is a very useful Mitsubishis Ecodan selection tool which provides an estimate of how an ASHP (Ecodan) can deliver heat to your home. The tool estimates
- Annual running costs versus fuel types,
- Carbon emissions,
- Calculates the Payback period (the time taken to recoup the cost of the ASHP
- Rate of return for an ASHP.
Since 2018, to qualify for RHI a metred Pack is required and the RHI is paid on actual performance of the ASHP and the electricity used to generate heat. The Metering and Monitoring Service Pack (MMSP) provides an extra RHI payment totalling £1,610 over the seven years.