Both forms of the Renewable Heat Incentive (RHI) scheme are to be closed in Northern Ireland after the government admitted it had already overspent through its commitments to existing installations.
The decision was announced by Jonathan Bell, minister for enterprise, trade and investment, who said the success of the scheme had exhausted the available budget for new applications.
“It is with great reluctance that I have had to announce my intention to close both RHI schemes,” he said.
“To meet RHI commitments for existing installations, significant levels of additional funding will have to be found from within the Northern Ireland Executive’s budget for the next five years to address the current deficit. To prevent further overspend I must bring forward legislation to the Assembly to close both schemes to new applications.”
The non-domestic RHI was launched in Northern Ireland in November 2012 before being extended to the domestic market in December 2014. According to Bell, both have been very successful, with the non-domestic scheme seeing significant uptake during the last 12 months.
The NI government attempted to reduce its expenditure on the scheme when it introduced a second tier of lower payments for small and medium biomass systems. Predictably, this led to a considerable increase in applications in the run up to the implementation of the new tariff rates, locking the NI government into more expensive 20 year payment periods.
The RHI was launched in Northern Ireland to help the country reach its target of 10% heat from renewable energy sources by 2020, as set out in 2010’s Strategic Energy Framework. It is estimated that the government has surpassed its interim target of 4% by 2015, with around 6% of NI’s heating needs now met by renewable technologies.
Bell announced that his department would be carrying out a comprehensive review and audit to ensure the operation of both forms of the RHI are strictly in compliance with the scheme requirements and the underpinning legislation.
