Renewable heat plans welcomed by industry
The Energy Secretary, Chris Huhne, has announced details of the plans to expand the market for renewable heat supplies in the Renewable Heat Incentive (RHI) policy document.
The Renewable Heat Incentive is aimed at stimulating a new market for renewable heat and to increase the number of industrial, commercial and public sector installations by seven times to 2020.
The government will put £860 million into the scheme, which it hopes will increase green capital investment by £4.5 billion up to 2020.
Under the proposals, a system of RHI payments will be available to households from October 2012.
In the interim more than a quarter of the first year's budget will be set aside for up to 25,000 household installations through a 'RHI Premium Payment' to encourage take-up.
The government hopes the new financial incentive will encourage the installation of equipment such as renewable heat pumps, biomass boilers and solar thermal panels.
Chris Huhne said: "Renewable heat is a largely untapped resource and an important new green industry of the future.
"This incentive is the first of its kind in the world. It'll help the UK shift away from fossil fuel, reducing carbon emissions and encouraging innovation, jobs and growth in new advanced technologies."
The Combined Heat and Power Association (CHPA) welcomed the announcement , saying the scheme would pave the way new expansion of ultra-efficient Combined Heat and Power (CHP) plants in buildings and industry.
CHPA director,Graham Meeks, said: "This is an important step forward in opening up the opportunity to develop new renewable CHP plant, at a range of scales and in many new applications.
"By placing an explicit value on renewable heat supplies, we hope to see an end to the wasteful practices that see much of our precious bioenergy resources dumped into the atmosphere through cooling towers.
"The key to progress across the market lies in the value of the incentive. We welcome the Government's commitment to CHP and the undertaking to look carefully at how the RHI and Renewables Obligation work together to mobilise renewable CHP across the market."
Full details of the scheme are available on the Department of Energy and Climate Change (DECC) website. Alison Brown