Renewable Heat Incentive (RHI) Guide

Renewable Heat Incentive

What’s in this guide?


Have you ever heard of the renewable heat incentive?

This guide will let you know everything you need to know about the renewable heat incentive, including what it is and what you could earn.

Let’s find out more.

What is the renewable heat incentive?

This is a government scheme that encourages homeowners in England, Scotland and Wales to install renewable heating technology, and lower their carbon footprints.

Launched in 2014, the scheme means that as long as you install an available heating system and stick to their rules, you could be paid a cash sum each quarter as a renewable energy incentive.

The UK government claims that it’s the first of its kind, and expects that the RHI scheme will contribute towards their mission to have 12% of all heating come from renewable sources by 2020.

Ofgem administers elements of the scheme, while the BEIS makes the critical policy decisions.

Let’s take a look at what kinds of renewable heating the renewable heat incentive covers.

What kind of renewable heating does the RHI cover?

So what types of renewable heating are eligible under the RHI scheme?

✔ Biomass boilers
✔ Biomass pellet stoves
✔ Air to water heat pumps
✔ Ground to water heat pumps
✔ Solar thermal panels
✔ Certain cooker stoves
✔ Some water source heat pumps

What types of heating aren’t covered?

Now that we know which type of heating is covered, which ones aren’t?

✗ Air to air heat pumps
✗ Log stoves
✗ Hybrid PVT

What could I earn?

So, if you’re interested in possibly investing in renewable heating, one of the main things to consider are the costs associated with the RHI and what you could earn from it.

To start with, how much do these renewable heating sources cost?

You’ll be looking at a price range between £4,000 for solar water heating, up to around £18,000 for a ground source heat pump.

However, after a few years, most customers will see a fall in their heating costs. If you add your RHI payments over the seven years as well, you should find yourself quickly making back the money you spent.

Take a quick look at the table below to see what kinds of prices your energy might be costing you right now, compared to the payments you could be receiving from the renewable energy initiative.

1-bed semi-detached

2-bed semi detached

3+ bed detached

Example heat demand (kWh) 8,000 12,000 17,000
Estimated annual cost of a current heating system
Gas £366 £548 £777
Electricity £1,500 £2,250 £3,188
Oil £368 £552 £782
LPG £529 £793 £1,124
Coal £347 £521 £738
Estimated annual RHI payment
Air source heat pump £610 £916 £1,297
Grand source heat pump £1,571 £2,357 £3,339
Biomass boiler £308 £462 £655
Solar thermal panels £174 £277 £400

You can use the domestic RHI payment calculator to find out how much you could be earning.

Who can apply?

If you want to apply for the renewable energy initiative potentially, this is the eligibility criteria.

✔ Owner-occupiers
✔ Self-builders
✔ Private landlords
✔ Social Housing
✔ Single residential houses

How do I apply?

Do you fit within the eligibility criteria?

Let’s find out how you can apply.

Keep in mind that you need to apply for the renewable heating initiative within a year after commissioning your renewable energy source.

To apply, this is what you will need.

✔ Installation certificate number for MCS
✔ Energy Performance Certificate
✔ Bank details

You might also need:

✔ The amount paid
✔ The date
✔ Cost of the installation


In some instances, you may have to install a meter to determine what the heating output of one of your renewable heating sources are.

You can buy a metering and monitoring service package from your installer when you install a new renewable system, which can provide you with peace of mind that your heating source is working just as it should be.

This can help to improve the performance of your system where possible and help to diagnose issues when they occur.


Do you want to make a switch to renewable energy?

Did you know that you could be saving £500 annually on your energy bills every year?

Take a look at the EnergySeek guides to find out more about your energy, or see reviews of the top 7 energy switching sites to compare gas & electricity.