Wood-Fuel Supplier Has Praised Renewable Heat Incentive Reforms

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Peter Solly, managing director of Forest Fuels, has said that ‘renewable heat incentive reforms are excellent news for business.’

The managing director of the UK’s leading biomass wood fuel supplier has welcomed the results of the government’s Renewable Heat Incentive (RHI) consultation, citing the government’s commitment to the scheme until 2021.

The consultation – which was released yesterday by the Department for Business, Energy and Industrial Strategy (BEIS) – provides certainty that there will be ongoing financial support for the promotion and development of low carbon heating.

“This is excellent news for the environment, our customers and our industry as a whole,” said Peter Solly. “It’s confirmation that the government is committed to a long term strategy to reduce reliance on fossil fuels and increase the move to cleaner and sustainable wood-fuelled energy which is hugely positive. Biomass heat continues to be a vital part of the Renewable Heat Incentive and it’s great to have clarity of this commitment all the way through until 2021.

“This will help many businesses both large and small to make positive decisions about new installations safe in the knowledge that financial incentives are in place to encourage and support the right schemes for them that are also kinder to the environment.”

The headline points from the consultation are:

• Biomass heat remains a vital component in the shift to low carbon heating
• Biomass heating support will be at the same level across all sizes of projects. This is a rate of 2.91p per kWh (Tier 1) and 2.05p per kWh (Tier 2). The tiering thresholds have been changed to significantly increase the amount of heat available under tier 1 (increased from 15% to 35%).

Peter Solly added: “These new RHI rates show a headline reduction for small and medium-sized projects and increased support for larger projects, however, when you look into the detail for the small and medium-sized projects the changes mean that biomass heat is still going to be viable across the full range of size of projects from schools and hotels through to process steam and district heating networks, particularly those with higher heat use.

“The move to increase the tiering levels and decrease the gap between tier 1 and tier 2 payments is also very encouraging because it will help ensure that projects that are genuine users of sustainable heat will still have an attractive return on investment. As a natural consequence it will help ensure that biomass boilers are correctly sized for projects and optimise the combination of capital investment, running cost savings and carbon savings.

“Another outcome is that we’re likely to see biomass boilers being sized to deliver base load heating rather than peak load. The uptake of biomass heating at larger and industrial scale projects is being actively supported which brings many benefits for businesses and communities right across the UK.

“Forest Fuels is already extremely successful in securing long-term energy supply contracts and commercial boiler buy-backs as they deliver worry-free, risk-free sustainable heat for our customers. Now that RHI rates are confirmed and secured it makes these products even more attractive especially for larger heat-loads.”

The full RHI consultation document is available at: https://goo.gl/cZmAZg