By David Fyffe, Fetternear Estate and a member of Scottish Land & Estates - as published in Press & Journal on 26 April 2014
Last week’s announcement of the domestic Renewable Heat Incentive (RHI) completes the package of support for smaller scale renewable heat and electricity generation across homes and businesses. Along with the Feed in Tariffs (FiT), the domestic and non-domestic RHI provide financial support which can greatly reduce energy bills and help achieve sustainability. This is good news for rural businesses - often reliant on expensive oil – especially if they have the space to install renewable measures are set to make the largest potential savings from the schemes. It should also be very welcome to farmers grappling with the ongoing challenge of making their operations most cost effective and efficient.
The feed in tariff has been on most farm and estate meeting agendas for some time now and many have already taken advantage of the scheme by installing small scale wind turbine, hydro schemes, solar PV, AD and micro CHP. The economic contribution study published by Scottish Land & Estates this week showed that renewable energy developments have taken place on around 40% of estates and a significant factor in their businesses.
In addition to the generation tariff the FiT also pays additional funds for exporting any electricity not used on site. Likewise, electricity can be bought from the mains if there is a lack of electricity produced on site. The Feed in Tariff funding comes from electricity suppliers rather than the government.
The non-domestic RHI can be used for business properties or district heating schemes using biomass and biogas boilers, ground, air and water source heat pumps, or solar thermal panels. A district heating scheme can include any combination of properties that are close enough together to be linked efficiently by pipework. Individual households can now access funding through the domestic RHI and receive subsidies for electricity generated from air and ground source heat pumps, biomass boilers and pellet stoves, and solar thermal panels.
The tariff rates for both FiTs and RHI will be reviewed and are likely to degress over time so in order to take advantage of the highest rates consumers should plan and proceed as soon as possible. It is important that the whole farm or estate energy needs are considered so the most viable option or combination of options is pursued. It should be considered that the rates and funding lifetimes differ for the domestic and non-domestic RHI and that planning permission will be required for some installations.
Ofgem publishes the tariffs available for all schemes and rates are available on its website.
The FiT and RHI schemes offer businesses and households, particularly those off the gas grid, with a more viable renewable heat or electricity source which can not only contribute towards sustainability targets but also can save significant expenditure.
For all of us involved in rural business the drive for efficiency seems to be relentless. It’s all too easy to focus on the more obvious decisions in an effort to cut costs but when an opportunity such as RHI comes along, it is one to be grasped with, hopefully, warmer hands.