The recently announced tariff extension to the UK's Non Domestic Renewable Heat Incentive (RHI) threatens the viability of thousands of "shovel-ready" low carbon schemes, according to Kensa Group.
Responding to changes announced in a press release published by the government on 30 June, David Broom, Kensa's sales director, says: "Miss-interpretation of the Government’s announcement has understandably led to clients wrongly assuming the Non Domestic RHI has been extended, and thus taking the pressure off applications.
The truth is the Non Domestic RHI has not been extended – the extension only applies to tariff guarantees, which will not be applicable to the majority of our clients due to tariff guarantees eligibility criteria for projects in excess of 100kW capacity; many social housing schemes will fall below this threshold.
Responding to changes announced in a press release published by the government on 30 June, David Broom, Kensa's sales director, says: "Miss-interpretation of the Government’s announcement has understandably led to clients wrongly assuming the Non Domestic RHI has been extended, and thus taking the pressure off applications. The truth is the Non Domestic RHI has not been extended – the extension only applies to tariff guarantees, which will not be applicable to the majority of our clients due to tariff guarantees eligibility criteria for projects in excess of 100kW capacity; many social housing schemes will fall below this threshold.
Any delay now could be financially and environmentally damaging."
He also questions the government's description of the tariff extension as a "boost for renewable heat projects" on the ground that it is only applicable to those in receipt of tariff guarantees or to those that apply for a tariff guarantee and are able to provide evidence of Stage 2 Financial Close before March 2021, earning applicants one extra year – until 31st March 2022 – to complete any installation work; with a March 2021 deadline remaining for all other applicants to the Non Domestic RHI.
Karl Drage, the company's business development director, adds: "A follow-on scheme to the RHI is an opportunity to ensure that the transition to renewable heat is appropriate, cost effective and achieves the aims of getting closer to net zero across the building stock. Government led schemes, to date, have failed to make significant progress, and this is a critical time on the path to 2050.
"All stakeholders in the heat sector are looking towards the transition to low carbon, renewable heat which will entail the large-scale replacement of fossil fuel burning boilers by heat pumps powered by an electricity grid with a low carbon factor."
