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New UK non-domestic RHI rules receive wary welcome

The UK Department for Business, Energy, and Industrial Strategy (BEIS) has released it’s response to the consultation "The Non-domestic Renewable Heat Incentive: further proposed amendments" and has confirmed its intention to restrict certain types of fuel drying that are supported under the Renewable Heat Incentive (RHI).

On December 14 the European Council and Parliament reached an informal agreement on the land use, land-use change and forestry (LULUCF) regulation.

Published by BEIS on January 29, the document sets out the UK government’s decisions on eligible heat use reforms following consultation in Chapter 2 of the consultation, and how these decisions will be implemented. Decisions on the other proposals will be published later this year.

Although the government does not intend to remove all drying practices as eligible heat uses under the non-domestic RHI it will:

  • remove wood-fuel drying as an eligible heat use other than where the renewable heat installation is replacing a fossil fuel heat source. A transition period will be included to allow wood-fuel drying plant that are in development to be accredited
  • remove the drying, cleaning or processing of waste as an eligible heat use
  • further tighten the RHI rules in relation to the eligibility of swimming pools and single non-domestic properties.

Reacting to the new rules, Frank Aaskov, policy analyst at the Renewable Energy Association (REA) and Wood Heat Association (WHA) said that the organisations welcomed the “principle of limiting eligible heat uses to ensure the scheme is used responsibly” but cautioned that the “RHI is a complex scheme and the new rules will need to be tested and be open to change to ensure innovative companies aren’t being punished.”

The central goal of the RHI is to drive down emissions from the heating sector in a cost-effective manner, and we must not be lost sight of that, said Aaskov.

However, representatives for the biogas and waste to energy sectors have voiced concerns.

The UK has robust and growing biogas and energy-from-waste sectors which include companies making biofuels from coffee grounds, green gas from food waste and transforming black-bag waste and waste packaging removed from food waste into electricity, heat and biofuels for transport. Many of these processes require the waste to be dried and prepared but we are concerned that this heat use is no longer eligible, said Dr Kiara Zennaro, Head of Biogas at the Renewable Energy Association.

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