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Government delays on RHI criticised

Neil Schofield, Worcester Bosch head of government and external affairs, has criticised the Government for dragging its feet on clarifying the details of the Renewable Head Incentive.

The renewables revolution has stalled, he says.

I don’t normally go in for hyperbole but these are the facts. Delays to Renewable Heat Incentive (RHI) are stopping consumers, who are ready to embrace renewables, in their tracks.

Projects are being mothballed or shelved completely as doubts over the Government’s commitment to domestic renewables grow by the day.

It was all so different a few short months ago. In the autumn of last year the Comprehensive Spending Review saved the Renewable Heat Incentive and put aside £860 million in Treasury funds.

All we waited for was the detail about which technologies would be included and the tariffs. But, we have waited and waited.

It is no exaggeration to say that the delay is costing the heating industry millions. Let me give you one example.

The award winning Sustainable Heating Company, based in Northampton, has recently lost three major projects due simply to customer concerns over the security of their investment in renewable technologies.

The lack of clarity over Feed-in Tariff rates for technologies means that customers are unable to calculate any return on investment and are, ultimately, concluding there is a risk that their investment in renewables will not pay off.

The latest loss involved a project worth £60-70,000 for a variety of renewable technologies to replace an old oil-fired boiler at a £1.5 million property.

The directors of the company have been on multiple site visits and advised the customer throughout the process, but he has pulled the plug blaming the Government’s indecision on tariffs for ground source heat pumps which gives the impression that it is not really committed.

The directors have put in multiple calls to DECC (Department of Energy and Climate Change) to try and get some clarity with the aim of saving the project, but nobody returns their calls.

Now, extrapolate that trend across the entire country and it is very easy to see that heating manufacturers and installers are losing millions in lost sales.

More worryingly for the long-term, many consumers are now beginning to doubt the Government’s commitment.

There is now no chance that the June start for RHI will be met and we still have no clear timescale for introduction.

In short, we can’t sell without details of tariffs, accurate timescales and a clear indication of whether, as promised, payments will be backdated to July 2009.

All of this is causing enormous confusion for the UK’s installer base. How can you accurately cost a job or give a customer an accurate return on investment (ROI) calculation?

How can an installer make a decision about which renewables training course to go on when it is not even clear which renewable technologies will be covered by the RHI? 

We are already dealing with one market distortion, namely the Feed-in Tariff’s effect on solar thermal sales which have dropped through the floor.

The last thing we need is further prolonged disruption. We need clarity and certainty (and a little continuity would not go amiss) and I would urge DECC to bring some order to the market as a matter of urgency.