Economy Minister Diane Dodds today published the Buglass report into hardship relating to participation in the Non-Domestic Northern Ireland Renewable Heat Incentive (NIRHI) Scheme.
The report, which was commissioned in October 2019, highlights the experiences of some participants in the NIRHI Scheme, from both financial and non-financial perspectives. While noting the challenges of separating the impact of businesses’ participation in NIRHI from wider business or economic factors, the report is clear that the changes in tariffs have impacted on cash flow for participating businesses. The economic consequences of this are varied and are dependent on the circumstances of each individual business.
The Minister said:
"I would like to thank Andrew Buglass for his report. I fully appreciate the complex and challenging nature of this work. I would also like to thank the NIRHI participants who engaged with Mr Buglass and informed the research.
"The conclusions present challenges. It is clear that the tariffs which were set at the outset of the scheme in 2012 were unsustainable and led to a point that between 2015 and 2018 significant funding from the block grant had to be diverted to sustain RHI tariff payments. The subsequent legislative changes in 2017, 2018 and 2019 were therefore necessary to bring costs within budget.
"The tariffs that were brought forward in 2019 were essential and were underpinned by a robust evidence base. Nevertheless, this most recent research has shown that the reduction in cash flow resulting from the reduced tariffs has been challenging for some. The Department acknowledges that many have made wider investment decisions and have ongoing financial obligations beyond the scope of the tariff. The Department also acknowledges that the public attention and scrutiny of the Scheme’s flaws has led to some negative perceptions of those participating."
The Minister said that her Department has committed to keeping the variables that underpin the tariffs under review and it is currently consulting on revising the tariffs based on this updated evidence base. She said Mr Buglass’ report would now be taken into consideration as part of the process to decide the future of the NIRHI Scheme.
"I welcome the report’s conclusion that the most important principle to be adopted is that of fair and equal treatment for all those who have participated legitimately. Since my appointment as Minister for the Economy I have been clear that my approach to the Scheme will be guided by fairness both to those participants who have acted in good faith, and to taxpayers who fund the scheme. I will continue to be guided by this principle."
Notes to editors:
- Following a Call for Evidence in summer 2019 which sought information and views from participants on the issue of hardship associated with participation on the Non-Domestic RHI Scheme, the Department appointed Andrew Buglass to engage with participants and undertake independent research into the issue. The Department’s response to the Call for Evidence is available on the RHI Hardship Unit Call for Evidence page on the Department's website
- Andrew Buglass, the founder of Buglass Energy Advisory (BAE), has nearly 30 years of experience providing expert support in the energy sector in the UK and has extensive investment and lending experience. He had no prior involvement with the NIRHI Scheme.
- The report in full can be viewed at the Non-Domestic Northern Ireland Renewable Heat Incentive Scheme – independent research into hardship page on the Department’s website
- For media enquiries contact the Department for the Economy Press Office at email@example.com. Out of office hours please contact the Duty Press Officer on 028 9037 8110
- Follow us on Twitter @Economy_NI
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