Hand in hand with its push to improve efficiency, the United Kingdom's Department of Energy and Climate Change (DECC) yesterday unveiled a plan to encourage heating from low-carbon sources -- the first of its kind in the world.
The Renewable Heat Incentive (RHI), released just two days after a sweeping road map to schedule carbon-cutting initiatives over the next five years, will initially provide £860 million ($1.38 billion) to kick-start a £4.5 billion ($7.2 billion) green capital investment goal for 2020.
"It'll help the U.K. shift away from fossil fuel, reducing carbon emissions and encouraging innovation, jobs and growth in new advanced technologies," said Secretary of State for Energy and Climate Change Chris Huhne.
This will go toward subsidizing businesses and residents to adopt low-emitting heat technologies such as solar heat pumps, biomass boilers and ground-source heating. Larger industries would be able to invest in anaerobic digesters, biomethane injectors and geothermal equipment. Returns will range, according to the size of the installation and source of the energy, from 1.9 pence (3 cents) per kilowatt-hour for biomass to 8.5 pence (14 cents) for solar thermal.
"We've been consulted so that this is as attractive [a plan] as possible," said a spokesperson for DECC. "I'm sure industry will help make renewable heat something that's accessible to homes."
Heating is the source of 46 percent of the country's CO2 emissions, with 95 percent of heating fuel coming from fossil fuels, according to DECC. Several other renewables programs are already in place in the country, including the Renewables Obligation and Feed-In Tariffs schemes to help drive demand for renewable electricity, and the Renewable Transport Fuel Obligation.
The incentive is planned in conjunction with the passage of the "Green Deal" in the proposed energy bill currently making its way through Parliament. Under the Green Deal, residents would be eligible for incentive payments to increase the efficiency of their homes, through improved insulation and other retrofits (ClimateWire, March 9). While the Green Deal targets heating efficiency, the RHI deals with the source of the heat.
The first phase will apply to non-domestic sectors. Recipients should expect payments by September, said a DECC spokesperson, with payments to households starting in October 2012 -- after the expected passage of the Green Deal. Until then, £15 million ($24 million) in "premium" payments will be disbursed to help cover the costs of new heating systems.
To be eligible for premium payments, one must live in a well-insulated home and be willing to give feedback on the new technology. Priority will also be given to those living on the gas grid -- as opposed to the electricity grid -- to heat their homes, which is both more expensive and carbon-intensive.
DECC projects renewable heating to grow to 13,000 installations in the industrial sector and 110,000 in the commercial and public sector by 2020, supplying 25 percent of the heat demand overall. Tariffs will be paid over 20 years for technology installed after July 15, 2009.
