RHI is a scheme designed to help and incentivize homes that make use of renewable energy heating technologies such as heat pumps.

The RHI could produce a quarterly payment for a period of 7 years. It is said that the Clean Heat Grant, which is a new proposal, is expected to replace RHI after March 2022.

The RHI was first established in April 2014, and on the 22nd of May 2018, the latest regulations came into effect. RHI was set up to minimise the effects of climate change, as well as being the main driver towards the UK’s goal for 2020, which was to have 12% of heating coming from renewable energy sources.

Here is an example of how domestic RHI Payments can be calculated

Domestic RHI payments are calculated taking into consideration three major factors:

• A property’s annual heating and hot water demand

• A heating system’s Seasonal Coefficient of Performance (SCOP)

• Current RHI tariffs

1. The annual heating and hot water demand are identified from the household’s Energy Performance Certificate (EPC), for example, 30,000 kWh/yr.

2. The amount of electrical energy that the heating system will consume is calculated by dividing the annual heating and hot water demand with the heating system’s Seasonal Coefficient of Performance (SCOP), usually estimated between 2.5 and 4 by the MCS installer, for instance, 30,000 / 3 = 10,000 kWh/yr.

3. The “renewable” content is calculated by deducting the previously calculated figure from the property's annual heating and hot water demand, for example, 30,000 - 10,000 = 20,000 kWh/yr.

4. The RHI annual payment is calculated by multiplying the previous figure by the current RHI tariff (20.89 p/kWh for ground source heat pump). For instance, 20,000 x 0.2089 = £4,178 per year.