The uncertainty surrounding Renewables Heat Incentives for Scottish businesses has gone on too long, according to Scottish Energy Minister Fegus Ewing
The RHI is a UK Government environmental programme that provides financial incentives to increase the uptake of renewable heat. The subsidy scheme is currently scheduled to lapse in 2017.
Ewing is pressing the UK Government to commit to the long term sustainability of the RHI which they have so far refused to do and has written to UK Energy Secretary Amber Rudd asking for urgent clarification.
“The uncertainty from the UK Government has been going on too long now and it is time to provide clarity for this industry,” said Ewing.
Earlier this week industry body Scottish Renewables estimated Scotland could fall short of its target for non-electrical heat demand to come from renewable sources by 2020.
Research by Scottish Renewables found the country is on course to generate 33,122 Gigawatt (GWh) hours from sources such as wind power, biomass and hydro electricity by 2020, less than its target total of 38,256 GWh
Star Renewable Energy are a Glasgow based company that install water source heat pumps, a low carbon technology that extracts heat from water sources to heat buildings efficiently.
They have already seen some schemes delay decisions about capital investment until there is further certainty on whether or not the RHI will continue beyond March 2016.
Star’s renewable heatpump expert Dave Pearson said: “”Our company has participated in feasibility studies, supported by the UK Government, for tens of millions of pounds of potential UK projects which could be scrapped if the RHI isn’t confirmed.
Our company has been involved in major projects across Europe and we have seen how low carbon heat has the ability to provide warmth to houses, offices and factories in even the coldest of climates like Norway.
“In the UK we are now seeing increasing interest from large scale projects in utilising water source heatpumps to heat homes and businesses.
“We have already seen some schemes delay decisions about capital investment until they have some certainty on whether or not the RHI will continue beyond March 2016.
“The RHI is a world class incentive scheme, and it is imperative that it continues. If funding is maintained beyond March 2016, I’d like to see pre-accreditation of all large scale projects in order to drive the market.”
Mr Ewing said: “The Scottish Government believes that development of a sustainable renewable heat industry will be a key factor in helping Scotland meet its climate change targets and provides huge business opportunities.
“I was pleased that 2014 saw the biggest rise in heat capacity generated from renewable sources in Scotland – an increase of 42% from the year before.
“Our target remains challenging and will require us to use all the levers at our disposal, particularly the RHI. Without continuation of the Renewable Heat Incentive, or a substantive replacement, there will be a substantial impact on renewable heat businesses and jobs in technologies, with disastrous results for the future of these Scottish businesses.