Renewable Heat Incentive is born!
28 November 2011

After a very long gestation period for the Renewable Heat Incentive, Ofgem started accepting applications from Monday 28 November.

Owners of ground source heat pumps systems (and other eligible renewable heat technologies) in non-domestic buildings, installed since 15 July 2009, can apply to Ofgem to be paid 3.2 pence/kWhour of renewable heat generated for each of the next 20 years.

For installations up to 45 kW heating capacity MCS approved equipment must be installed by approved MCS installers. For all installations up to a capacity of 100 kW the RHI is increased to 4.5 pence/kWhour.

See more at RHI

DECC rebalances Renewable Energy Incentives

Following reductions in the cost of PV installations, DECC is reducing the FITs by half from 8 December 2011. However, this subsidy for installing PV remains at a much higher level than the RHI for installing ground source heat pumps per kWh, because the government has calculated that a large subsidy is required for PV to make it attractive.

The clear implication is that installations of ground source heat pumps are a much more economic means of achieving carbon reductions than installing photovoltaic panels (or wind turbines).

Vertical Borehole Standard

The GSHPA's Vertical Borehole Standard which covers the design, installation and testing of closed-loop vertical boreholes was published in September 2011.

MIS 3005

The MCS Microgeneration Installation Standard for heat pumps, version 3.1, has now been published: MIS 3005 Heat Pump Systems.

The GSHPA has contributed to MIS 3005 and the Environment Agency's Good Practice Guide.

GSHPA Newsletters

• September 2011
• August 2011
• July 2011
• June 2011
• May 2011
• April 2011
• March 2011
• February 2011

See also previous newsletters.

Price of gas soars

On 8 June 2011 Scottish Power announced a 19% increase in the price of gas from 1 August.

On 8 July 2011 British Gas, owned by Centrica, announced it is putting up its domestic gas prices by 18% and electricity prices by 16% from 18 August. This follows a 7% increase in both gas and electricity in December 2010.

On 21 July 2011 Scottish & Southern announced a 18% increase in the price of gas from 14 September, on top of a 9% increase in gas in December 2010.

As this is attributable to increases in the wholesale price of gas, increases from other suppliers seem inevitable. With inflation running at 4.5%, why is this occurring? What is the background?

• World demand for gas increased by 7.4% last year - the largest annual increase ever.
• An increasing world population, enjoying increasing wealth, is demanding more gas.
• Gas is used for heating, industrial purposes, and generating electricity at power stations.
• The nuclear meltdown at Fukushima following the Japanese earthquake and tsunami on 10 March 2011 has raised safety questions over generating electricity from nuclear plants.
• Since Fukushima, Germany and Switzerland have announced that they will phase out their nuclear power stations. Electric power generation using gas is the obvious alternative.
• Italy, in a referendum on 12 June 2011, has overwhelmingly rejected generating electricity with nuclear power.
• Britain's new generation of nuclear power stations are likely to be delayed in the wake of the nuclear meltdown at Fukushima.
• The retail price of gas has risen 233% since 2004.
• The price of gas in the UK has historicaly been low because of the supply from the North Sea and a well developed distribution system of piped gas to nearly all houses in urban areas.

What will happen to the price of gas in future?

The price of gas has risen in the past, is rising now and is likely to continue rising in the future. The increase in world population will put increasing pressure of demand on gas - and other natural resources. The price of electricity tends to rise in line with the cost of gas.

What is the alternative to using gas for heating?

A ground source heat pump provides gas-free heating.