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Non-domestic RHI amendments released – UK biogas and biomass industries react

The UK’s Department for Business, Energy, and Industrial Strategy has released its response to a consultation on The Non-domestic Renewable Heat Incentive: further proposed amendments. Addressing the types of fuel drying that are supported under the Renewable Heat Incentive (RHI), the UK’s government backed heat decarbonisation scheme, the outcome could have a significant impact on both the biogas and biomass sectors.

Back in September 2017, the Government opened the consultation, which made a range of proposals for changes to the non-domestic RHI scheme rules. These included changes to rules relating to eligible heat uses, very large plants, environmental permitting, and biomethane plants in particular, as well as a range of other areas.

The Government published its response to the publication on 29 January. One of the changes specified is the removal of the drying, cleaning or processing of waste as eligible heat use. Wood-fuel drying is also removed an eligible heat use “other than where the renewable heat installation is replacing a fossil fuel heat source.”

 

Mixed response from the biogas sector

Charlotte Morton, chief executive of the UK’s Anaerobic Digestion and Bioresources Association, ADBA, noted that the further amendments were an improvement on what was proposed in the initial consultation.

“We’re pleased to see that, contrary to what was proposed in the consultation, not all drying practices will be removed as eligible heat uses. This avoids the imposition of a blanket rule which, in our view, would have been a knee-jerk overreaction to what are important issues around drying practices,” Morton told Bioenergy Insight.

However, Morton also insists that progress in passing the final RHI should now be a priority: “The government now urgently needs to pass the delayed RHI legislation that will guarantee higher tariff levels for renewable heat generation and restore confidence to the AD industry, allowing it to make a vital contribution to a range of policy goals.”

Head of Biogas at the Renewable Energy Association (REA), Dr Kiara Zennaro, had a cautious outlook on the potential consequences of the consultation.

“The UK has robust and growing biogas and energy-from-waste sectors which include companies making biofuels from coffee grounds, green gas from food waste, and transforming black-bag waste and waste packaging removed from food waste into electricity, heat and biofuels for transport. Many of these processes require the waste to be dried and prepared but we are concerned that this heat use is no longer eligible. 

“While there are positive aspects of this consultation this change could be a backwards step for the circular and bio-economies.”

 

What does it mean for the biomass industry?

Frank Aaskov, a policy analyst at both the Renewable Energy Association and Wood Heat Association, said: “We welcome the principle of limiting eligible heat uses to ensure the scheme is used responsibly.”

However, he also noted the importance of allowing the new rules to be amendable and encouraging to innovation.

“The central goal of the RHI is to drive down emissions from the heating sector in a cost effective manner, and we must not lose sight of that. The RHI is a complex scheme and the new rules will need to be tested and be open to change to ensure innovative companies aren’t being punished.”

 

 





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