Renewable Heat Incentive How to apply GSHPA, 22 October 2012 Barney Merrett Manager – Small & Medium Generation RHI, Ofgem E-Serve

RHI Opportunities Renewable Heat Incentive (RHI) – what is it? www.ofgem.gov.uk RHI Opportunities Renewable Heat Incentive (RHI)  – what is it? Levels of support provided by the RHI Technology options Eligible heat uses & metering How to apply What to be aware of How to get through the accreditation process

www.ofgem.gov.uk The RHI A world-first financial incentive to promote the generation of renewable heat £860m for RHI over four years confirmed spend Scheme funded through taxation, not a levy Payments made quarterly over 20 year period on basis of metered heat generation (p/kWh) Non-domestics only at present domestics to be included later Estimated 1m participants by 2020 Went live November 2011 Ofgem responsible for administration – DECC responsible for policy

Ofgem E-Serve’s role in the RHI The RHI is a DECC initiative (£860M) Ofgem E-Serve is the Administrator Our role includes: Handling enquiries Evaluating eligibility and processing applications Holding data Making payments Fraud and compliance Auditing

Technologies currently supported www.ofgem.gov.uk Technologies currently supported Technologies currently supported Solar thermal (below 200kWth) Solid biomass, e.g. wood chip Municipal Solid Waste Biogas (below 200kWth) Ground/water source heat pumps (not air) Geothermal Biomethane injection to the gas grid

RHI tariff rates Generation Technology Scale (installation capacity) RHI tariff payment/kWh (p) Biomass Small commercial (< 200kWth) 8.3/2.1 Medium commercial (200kWth < 1MWth) 5.1/2.1 Large commercial (>= 1MWth) 1 Heat pumps/deep geothermal Small commercial (< 100kWth) 4.7 Large commercial (> 100kWth) 3.4 Solar collectors < 200kWth 8.9 Biomethane and biogas combustion 7.1

Ofgem E-Serve’s role in the RHI www.ofgem.gov.uk Ofgem E-Serve’s role in the RHI RHI Process The RHI is a DECC initiative (£860M) Ofgem E-Serve is the Administrator Our role includes: Handling enquiries Evaluating eligibility and processing applications Holding data Making payments Fraud and compliance, including audits One Off Repeated Xx

Key eligibility criteria Installed/first commissioned on or after 15 July 2009 Equipment new at time of installation Grants not received for purchase/installation of equipment Medium of heat transfer must be liquid or steam - i.e. no direct air heating No single domestics at present (but RHPP may be an option) Definition of domestics: “single self contained premises used wholly or mainly as a private residential dwelling where the fabric of the building has not been significantly adapted for non-residential use” MCS or equivalent EN45011 Requirement under 45kWth for solid biomass, heat pumps, solar thermal Certification required for both the installer (at time of installation) and plant

Eligible Heat Uses Eligible heat uses Heat Uses Definition of building In a building for… Space heating, hot water or carrying out a process (not electricity) Definition of building “permanent or long-lasting building or structure of whatever kind and whether fixed or moveable which, except for doors and windows is wholly enclosed on all sides with a roof or ceiling and walls” NB: must not generate heat for predominant purpose of increasing payments

Compliance and enforcement One of Ofgem’s functions is to monitor and enforce compliance with upfront and ongoing requirements We aim to be helpful and avoid being unnecessarily onerous but… WE WILL AUDIT In deciding whether to take enforcement action, we will take into consideration circumstances including: Seriousness of the non-compliance Whether the participant voluntarily reported the non-compliance Reasons why the non-compliance occurred and any mitigating circumstances Whether there is a history of non-compliance by the participant Whether the participant has gained financially through the non-compliance

Other documentation you may need to apply… www.ofgem.gov.uk Other documentation you may need to apply… Documentation you may need… Receipts and/or invoices relating to the installation of the equipment Commissioning certificate Commissioning report Photograph of the installation clearly showing the serial number of the equipment, and output capacity Evidence that any grant has been surrendered or repaid in full Copy of meter Class 2 Measuring Instruments Directive (MID) certificate Manufacturer’s technical specification for heat pump units to support COP claims Xx

Metering Metering issues: Types of meters Eligibility Evidence In pipe (mechanical, pressure) Ultrasonic/electromagnetic Eligibility Evidence

Metering eligibility At least one meter – heat or steam Meter standards – MID Conformity, Class 2 Accuracy Appropriately calibrated and installed Meter placement Schematic diagrams should be clear Independent report on metering arrangements Heat loss calculation – only where metering is unduly burdensome

Metering Evidence Measuring Instruments Directive (MID) Conformity Evidence – “Certificates of Conformity” NB: “Type Examination (‘B’) Certificate” is not enough... Evidence of Accuracy Class 2 Photo (integrated/packaged heat meter) Technical specifications or testing certificates for each component (separate components) Independent Report on Metering Arrangements Should be complete – and sufficiently detailed that we can rely on this as evidence

Simple or complex metering? Simple or Complex Metering? Do any of following apply? Heat delivered by steam CHP Heat used in more than one building Ineligible heat uses on heating system Yes – one or more apply No – none apply COMPLEX Need to meter all of: Heat generated by eligible installation Total eligible use of heat on system Heat generated by all plants on heating system SIMPLE Only need to meter: Heat generated by eligible installation

Simple or complex metering? Simple or Complex Metering? “We need to know the fraction of heat used that is coming from the RHI-eligible installation – we can only pay for that fraction of the heat used for eligible purposes” SIMPLE “Just meter the heat generated – we can pay for all of it” Heat generated by RHI installation Heat generated by RHI installation Heat used for eligible purposes x Heat generated by all plant on the heating system

Independent Report on Metering Arrangements (IRMAs) Must be produced by a ‘competent’ individual Unbiased and impartial With PI insurance of at least £1 million No list as yet but HVCA looking to produce one – Others are likely to become available Needed for all installations over one MW and all complex systems over 45kW A report template has been produced and must be followed

Heat Pumps Heat pumps of all scales that utilise heat sourced from naturally occurring solar energy stored within the ground or surface water are eligible for the RHI Heat pumps with an installation capacity of up to and including 45kWth must be certified under the MCS or equivalent scheme

Reversible Heat Pumps Eligible, providing they are not used solely for generating cooling Only heat generating is eligible for RHI support Cooling generated must not be included in meter readings submitted to us We may ask participants to explain how they will account for any cooling generated

RHI Criteria Specific to Heat Pumps What are the regulations? Regulation 8 relates to Heat Pumps “Naturally occurring” The “ground” (includes groundwater) or “surface water”. COP of “at least 2.9” Application process examples for heat pumps: Demonstration of COP Heat pumps with integrated immersion heaters Other eligibility criteria in the wider regulations

Overview of the accreditation process

Application Process Managed online via the RHI register www.ofgem.gov.uk Application Process Managed online via the RHI register Each applications has 3 Levels of checks before ‘Delegated Authority’ sign off Applies to all RHI applications ...even those with an MCS certificate? Application review process terminology Full and preliminary applications Xx

www.ofgem.gov.uk Timescales No decision can be made until a full review has been conducted Approximate timescale from submission to accreditation approval or rejection notification Does not include time ‘with applicant’ Good quality applications are accredited more quickly! Xx

www.ofgem.gov.uk Application Process Xx

www.ofgem.gov.uk Xx

Level 1 Checks Quick ‘high level’ check www.ofgem.gov.uk Level 1 Checks Quick ‘high level’ check Sufficient detail in text based answers All documents provided are what is required Any grant related issues raised at this point Potential outcomes: Everything present and correct. Assign onwards for Level 2 review. Information missing. Place ‘With Applicant’ and make contact to request further information required. Once this is submitted process as per (a). Xx

Level 2 Checks Full eligibility check of an application. www.ofgem.gov.uk Level 2 Checks Full eligibility check of an application. Check on details of documentation. Check answers provided. Full check on metering schematic to review suitability on metering. Potential outcomes: Everything present and correct. Assign onwards for Level 3 review. Information missing. Place ‘With Applicant’ and make contact via CRM system to request further information required. Once this is submitted process as per (a). Xx

www.ofgem.gov.uk Level 3 Checks Provides quality assurance and checks consistency of findings during the level 2 review. Review of any outstanding issues which could not be resolved at the Level 2 stage. Any legal or technical expertise can be requested here if necessary Ensure any ‘additional’ conditions are communicated Special focus on metering schematic Recommendation made to the delegated authority Recommendation for approval Recommendation for rejection Xx

www.ofgem.gov.uk Ofgem Checks Evidence to show ‘Installation’ is new: Invoices submitted for all components Heat meters MID & class 2: Specific evidence i.e. a Certificate or Photo Letter of Authority: To be written as per template (Guidance Note 2 or webpage) Schematic review: Correct & must include all necessary components Meter readings within effective date: Must be within 3 days of submission date Evidence of existence: Commissioning Report IMR (Independent Metering Report): Must be done by someone competent & using the required template Proof of Heat Pump COP >2.9 : Manufacturers information Solar thermal meter suitable for Glycol: Metering manual details

How to Apply for Accreditation www.ofgem.gov.uk How to Apply for Accreditation

Top Tips: How to Ensure a Good Quality Application www.ofgem.gov.uk Top Tips: How to Ensure a Good Quality Application Utilise guidance resources available ...if something is still not clear, just ask! Have required documentation available Missing (posted) documents cause delays Detailed schematic containing all relevant information required Illegible / confusing documents Simple / complex metering Complex metering requirements for CHP, heat by steam, ineligible purposes and; Heat generated and used in > 1 building Sufficient detail in text based questions Remember your log in details / quote RHI number Xx

Direct RHI Register Link www.ofgem.gov.uk Direct RHI Register Link Please go to our website address: https://rhi.ofgem.gov.uk Select option to ‘Create a new RHI Account’ Xx

The RHI team – Ready to help

Ofgem E-Serve: How we can help www.ofgem.gov.uk Ofgem E-Serve: How we can help Enquiries: 0845 200 2122, RHI.Enquiry@Ofgem.gov.uk Comprehensive published information; Guidance on the Scheme Volume 1 (Eligibility) Volume 2 (Ongoing Obligations) Supplementary fact sheets & FAQs Online application process Xx

www.ofgem.gov.uk Metering Schematics Figure 1.8: Illustration of possible metering arrangement for a complex installation where decentralised ineligible plants (in this example, fossil fuel boilers) are located on secondary heating circuits in separate buildings. Note that the flow meter can be placed in either the flow or return pipe. Red lines denote the hot flow pipes, and blue lines indicate the cool return pipes. This schematic has been annotated with a key, a table of meter specifications, and building names/boundaries, as discussed in Section 1.4 of Volume One’s appendix Xx