Economy Minister Diane Dodds today launched a consultation on the Non-Domestic Renewable Heating Incentive (NDRHI) tariff review.
The Department committed to keeping the tariffs under review when it brought forward the 2019 legislation that implemented reduced tariffs for small and medium-sized biomass boilers accredited to the NDRHI scheme.
An independent energy consultancy was engaged to review the variable elements of the tariff and it has recommended increasing the medium biomass tariffs in order to achieve the appropriate return on investment.
The Minister said:
"I have made it clear that, in relation to matters involving the RHI Scheme, I will always seek to act in a manner that is fair to both scheme participants who joined in good faith and to taxpayers who are funding the scheme.
"This consultation considers the tariffs payable on medium-sized boilers which make up the vast majority of installations on the scheme. The preferred option, set out in this consultation, proposes increasing the tariffs in line with the recommendations from the independent experts who identified changes in a number of the underlying variables since the current tariff structure came into effect last year.
"Ultimately this is about ensuring the tariffs are set at a fair rate that is representative of the conditions faced by participants. I would welcome all views on this consultation before it closes."
The consultation closes on 26 May 2020. Any amendment to the tariff will require legislation in the Assembly.
Notes to editors:
- The consultation can be accessed on the DfE website or on nidirect
- Tariff levels are set based on a number of variable factors such as, for example, the relative cost of wood pellets and heating oil. These 2019 tariffs were calculated on the basis that the typical boiler on the Scheme would achieve a prospective 12 per cent rate of return.
- Independent energy consultancy, Cornwall Insight were engaged to review the variable elements of the tariff in autumn 2019 and produced a final report on 26 February 2020. Due primarily to a rise in fuel prices and boiler service and maintenance costs Cornwall have recommended increasing the medium biomass tariffs. This proposed uplift aims to allow participants to continue to achieve a prospective target rate of return of 12 per cent.
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