Interaction between the RHI and Renewables Obligation
Electricity generated by renewable CHP installations is currently supported under the Renewables Obligation (RO) scheme. The level of support received is determined by the installation's RO banding which is dependent on the technology and/or feedstock utilised. Provided that the renewable CHP installation is registered as ‘good quality CHP' (GQCHP) under the CHP Quality Assurance (CHPQA) scheme the installation is also eligible for an uplift on the relevant RO banding. The GQCHP uplift is designed to support the renewable heat generated by the plant and is equivalent to an additional 0.5 Renewable Obligation Certificates (ROC) per MWhe of power generated. The current RO bandings relevant to CHP installations are shown in the table here.
In addition to the GQCHP uplift, installations registered as GQCHP may also claim Enhanced Capital Allowances (ECA).
A new renewable CHP installation may also opt to receive support under the new Renewables Heat Incentive (RHI). Currently, the RHI is payable for any useful heat generated provided it is not used for power generation or used within renewable energy system itself e.g. to heat an anaerobic digester. This is currently in addition to support under the RO for the electricity generated. However, a renewable CHP plant claiming RHI may not also claim the ROC uplift for GQCHP. In addition to this, a renewable CHP plant claiming RHI may not claim support under the ECA.
In summary a new renewable CHP installation currently has two options through which to receive support:
- Register as GQCHP and claim ROCs, including the 0.5 ROC uplift, and ECA
- Claim RHI and ROCs excluding the ROC uplift and ECAs
Please note that the Government is currently reviewing the levels of banded support under the RO for the period between 2013 and 2017, and it is proposed to end the GQCHP uplift for new stations accredited on or after 1st April 2015. All new CHP stations accredited from this date onwards will instead receive support from a combination of the RO and RHI. A transition period will run between 1st April 2013 and 31st March 2015 where developers of new accreditations and new additional capacity will have a one off choice between the GQCHP uplift or RHI support. The GQCHP uplift will be grandfathered for all CHP stations accredited prior to 1st April 2013 which have at any time claimed the GQCHP uplift. Furthermore, all new CHP stations accredited during the transition period that chose the GQCHP uplift shall also be grandfathered.
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