UK Government planning to replace Renewable Heat Incentive with Clean Heat Grant

The UK Government has outlined its intentions to replace the Renewable Heat Incentive (RHI) with a new Clean Heat Grant that will aim to help households and businesses decarbonise through technology and push the nation towards its net-zero target for 2050.

The RHI was put in place by the Government as a means to convert 12% of UK homes to renewable heat by the end of 2020.

The Government announced on Tuesday (28 April) that the non-domestic RHI scheme would close for new applicants from April 2021. As promised in the Budget, however, the RHI for households and organisations has been extended to March 2022.

A consultation had been launched to formalise the replacement scheme for the RHI. The Government is proposing a Clean Heat Grant that would commence in 2022, offering funding support of up to £4,000 for each household or business that integrates heating technologies such as heat pumps. An eligible list of technologies applicable for funding support will also be outlined.

The Government is also proposing a new Green Gas Support Scheme to increase the percentage of biomethane available on the gas grid. However, the Government is no longer considering banning biomass boilers in urban areas from securing financial grants. There had been some concerns that the systems were worsening air pollution.

The Government intends to use the consultation to outline the support mechanisms required by business to decarbonise the UK’s commercial and domestic building stock, which accounts for approximately 40% of the UK’s carbon emissions.

The Committee on Climate Change has suggested that the UK would require 15 million homes to be fitted with heat pumps or hybrid heat pumps by 2035.