Wed 12 Jun 2019

Government extends deadline for Renewable Heat Incentive ("RHI") projects

The UK government has announced plans to extend the previous construction completion deadline for Renewable Heat Incentive (RHI) projects by a year.

RHI was set up to encourage the uptake of renewable heat technologies among households, communities and businesses by providing financial incentives to contribute towards the UK’s 2020 goal of 12% of heating coming from renewable sources.

Under the previous regulations, a project could be "pre-accredited" for a guaranteed subsidy tariff before construction of that project is completed. In order to secure that guaranteed tariff, a pre-accredited project would require to commence injection of biomethane by 31st January 2020 (or 183 days after the date when the applicant expected the project to commence).

However the Department for Business, Energy and Industrial Strategy has announced that legislation will be brought forward later in the year to delay the deadline until 31 January 2021.

The delay is perhaps not surprising, given industry concerns about the “extremely tight” timeframe of the original deadline especially when taking into account the build times of biomethane projects and the time needed by the gas networks to verify that the commissioning followed compliant procedures.

It should be noted that the extension in the deadline is not automatic and only applies to new applications. Therefore, if a project with an existing guaranteed tariff wishes to benefit from the extension, they will be eligible to withdraw their current application and reapply to the extended allocation of the scheme.

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