Tariffs and payments: Domestic RHI

Mae’r dudalen yma ar gael yn Gymraeg.

The Government introduced new regulations on 20 September 2017. For information on what the Government changes mean for you, please see our changes to the scheme webpage.

Tariffs set the rate for your Domestic Renewable Heat Incentive (RHI) payments. People who join the scheme and stick to its rules receive quarterly payments over seven years. The rates are set by the Department for Business, Energy and Industrial Strategy (BEIS), formerly known as the Department of Energy and Climate Change (DECC). You can view BEIS' budget announcements on their website.

Government consultation response on changes to the RHI

The Government published its response to the consultation on Renewable Heat Incentive (RHI) reform in December 2016. The first stage of changes came into effect on 20 September 2017. Subject to Parliamentary approval, the other changes announced in the December 2016 reform are planned to follow later in 2017/2018. For information on what the Government changes mean for you, please see our changes to the scheme. For information on what the Government changes mean for you, please see our webpage changes to the scheme.

No degression: 1 October 2017

The first stage of changes came into effect on 20 September 2017, there will be no degression on 1 October 2017.

How the Retail Price Index (RPI) and Consumer Price Index (CPI) affect tariffs

During your seven years’ scheme membership your tariff rate changes in line with Retail Prices Index (RPI)open key term pop-up or Consumer Prices Index (CPI)open key term pop-up, calculated in April each year. It does not change for any other reason. These updates will happen automatically and you can view them in MyRHI. Log in to see them in your payment schedule.

Applications submitted before 1 April 2016 have their tariffs adjusted in line with the Retail Price Index (RPI).

Applications submitted on or after 1 April 2016 have their tariffs adjusted in line with the Consumer Price Index (CPI).

Scheme budget management (degression)

The Department of Business, Energy and Industrial Strategy (BEIS), formerly known as the Department for Energy and Climate Change (DECC) has to keep the Domestic RHI scheme within budget. Sometimes, they lower the tariff rates for new applicants if payment amounts are higher than a set threshold. This is called Degressionopen key term pop-up

Tariffs are reviewed every quarter, but the rate will only reduce if the total amount of payments made is higher than the degression trigger or super-trigger. If a tariff reduction is due to take place, we publish it as soon as possible. 

A tariff reduction only affects people who are applying after the degression date. If you submit a complete application to us before the reduction takes place you won’t be affected if your application is successful. We base your tariff on the submission date (the date you submit the application, not the date you officially join the scheme). This means that if your application is still being reviewed when degression comes into effect, you won’t lose out. If you’re having technical problems submitting your application before a degression date, please contact us in writing in advance.

For more information, see Scheme budget managementopen key term pop-up.

Compliance and Fraud

During each degression period we carry out increased monitoring to ensure that the information applicants provide us with at application is accurate. For further information on our counter fraud processes and approach, see our Counter fraud for environmental and social programmes webpage.

Retail Prices Index (RPI)

This is the measure of inflation published monthly by the Office for National Statistics. All Domestic RHI tariff rates will be adjusted in line with the RPI. If you have grant funding, the amount deducted from your scheme payments will also be adjusted. More.

Consumer Prices Index (CPI)

Applications submitted for the Domestic RHI on or after 1 April 2016 have their tariffs adjusted in line with the Consumer Prices Index (CPI). The CPI is a measure of inflation and CPI rates are produced annually by the Office for National Statistics (ONS). Tariffs will be adjusted in accordance with CPI on 1 April every year. If you have grant funding that will be deducted from your payments you should be aware that the amount to be deducted will also be subject to CPI adjustment.

Applications... more

Degression

A mechanism that the Department for Business, Energy & Industrial Strategy (BEIS) uses to control the scheme budget by reducing the Domestic Renewable Heat Incentive tariff. For more information about this see Scheme budget management.

Scheme budget management

To help manage the amount spent on the Domestic RHI, we use a mechanism known as ‘degression’ to reduce tariff levels on a pre-determined basis when uptake is higher than expected. More.

Publications and updates

  • Published: 20th Sep 2017
  • Factsheets, Guidance
  • 1 Associated documents
Read this factsheet if you want to find out what the Domestic Renewable Heat Incentive (RHI) tariffs are, how they can change, and if you may be affected.