Another big degression. Ouch!
The hardest hit are the small biomass installations — those under 200 kW (cut by 15%) and the domestic market (cut by 20%). While the figures still look good for the largest boilers, the payback period is gradually lengthening and the smaller boilers are hardest hit, because a small biomass boiler isn’t very much cheaper than a big one in comparison.
Here is the announcement I received from DECC:
As required by the RHI regulations we have today published the eighth quarterly forecast for the non-domestic scheme and the third for the domestic scheme.
You can read the announcements in full here:
- The 100% total scheme trigger has been hit. Total forecast expenditure for the non-domestic scheme is £296 million, this is £65.7 million above the 100% trigger for this quarter of £230.3 million. The total estimated expenditure represents the amount we anticipate we will pay out between 31 January 2015 and 30 January 2015, based on current application data. The result of this as set out in regulations is that all technologies where the forecast is above anticipated expenditure will receive an additional 5% reduction to tariffs.
- The small biomass tariff will be reduced by a further 15% from 1st April 2015. This is because:
- The 100% scheme trigger was exceeded this quarter for the first time. This applies a 5% reduction to any tariff which has exceeded its individual expenditure threshold.
- Small biomass has again exceeded its individual expenditure threshold or ‘trigger’ (that is, more is being spent on small biomass than expected)
- Following a tariff reduction of 5% in the previous quarter (10% including 100% trigger reduction), forecast expenditure has grown over the last quarter by more than 150% of the anticipated growth rate. This applies an additional 10% reduction.
· The biomethane tariff, has breached its technology trigger and the growth triggers required for a subsequent degression. However biomethane is exempt from a tariff reduction until 1 April 2015. The provisions for this are included in the 2015 RHI Regulations which also introduce the new tiered tariff. These regulations came into force on 12th February after being approved by parliament.
· The biomethane tariff will again be subject to a potential tariff reduction from 1 July 2015, and the outcome of this quarter’s announcement and last quarter ending 31 October 2014 will be used for the purposes of subsequent degression calculations.
- The domestic biomass tariff will be reduced by 20% from 1st April 2015. This is because forecast expenditure on biomass, at £17.7m, is above its trigger of £6m and its super trigger of £12m for the quarter ending 31 January 2015.
- None of the other technologies in the domestic scheme hit their triggers this quarter which means no further tariff reductions will be applied.
If you have any comments, questions or suggestions please email these to RHI@DECC.gsi.gov.uk, marking your email (‘RHI – forecast’).”