RHI – Costly, Complex And Unrealistic, Says OFTEC

Jeremy Hawksley
Jeremy Hawksley

The government’s flagship domestic Renewable Heat Incentive (RHI) scheme is a costly and unrealistic solution to lowering carbon emissions, which is failing to attract consumer support.

That’s the opinion of The Oil Firing Technical Association (OFTEC), following the publication of official figures which show just 347 homes have been helped by the initiative since its launch three months ago – a number which falls vastly short of the approximate 10,500 homes required to sign up each month to meet the Government’s ambitious 2020 RHI take up targets. Targets set out in DECC’s initial impact assessment stated that RHI will support around 750,000 renewable heat installations by 2020. But at the current rate of take up this goal looks far from achievable says OFTEC.

Jeremy Hawksley, OFTEC’s Director General says, “Even before the RHI was launched, we voiced concerns that the scheme would suffer the same fate as the Green Deal. This is because RHI payments only come into play once the renewable heating system has been installed and the average consumer simply cannot afford to get started due to the high upfront costs of between £8,000 and £19,000 to install these technologies.

“Whilst we recognise that the initial take of any such scheme is often low and that momentum may build, there is going to have to be an enormous surge of interest in the RHI to meet Government targets. We are doubtful that with such a costly and complex scheme this will happen.”

According to OFTEC a simple, all-inclusive boiler scrappage scheme would go much further than the RHI in helping the government achieve its ambitious carbon reduction target of 80% less emissions by 2050. Upgrading to a modern oil condensing boiler can reduce CO2 emissions in the average home by up to 20%, and according to OFTEC – a scheme to support the introduction of bio-fuels would deliver even greater savings.

Although the Government’s new Green Deal Home Improvement Fund helps households on gas to upgrade their old boilers, it does not apply to oil-fired boilers, discriminating against some 850,000 homes in rural England and Wales. This is despite an equivalent Scottish scheme including oil boilers and the success of an ongoing boiler scrappage scheme in Northern Ireland.

According to Mr. Hawksley, “What the country needs is a simple, accessible scheme which consumers can really get to grips with. We already know that a boiler scrappage scheme works as a similar initiative in 2010 saw 120,000 old, inefficient boilers replaced. It makes no sense for the Government to exclude English and Welsh homes on oil from upgrading their boilers through the Green Deal Home Improvement Fund, particularly as in Scotland oil homes can access these grants.”

OFTEC’s concern about lack of interest in the domestic RHI is supported by a recent survey conducted by OFTEC and heating oil distributor Watson Petroleum of 750 oil heated homes. This revealed that just 4% would consider switching to an air source heat pump with 73% choosing to upgrade to a new high efficiency, oil fired condensing boiler.

Mr. Hawksley concludes, “Our survey clearly demonstrates that the current appetite for renewable heating systems is minimal. In addition to the prohibitive upfront costs, there is also the impracticability of installing renewable technologies such as heat pumps which require new larger radiators and/ or underfloor heating to be fitted if they are to work effectively. Add to these factors an overly complex scheme and it’s no wonder the RHI is proving a turn off for consumers.”

“The Government needs to think again and instead of pushing expensive renewables which will only appeal to the wealthy few, it should channel its resources into realistic boiler up-grade schemes that will encourage millions of home owners  to take simple yet effective energy efficiency measures which will collectively make a greater contribution to CO2 reduction targets.”

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