Following the seventh quarterly review of the Non-Domestic RHI budget, DECC have announced today that the Small Commercial Biomass tariff will be reduced by 10% from 1st January 2015. This will affect new projects with a biomass boiler capacity of less than 200kW. For these projects the RHI payment will reduce from 7.6p to 6.8p per kWh at Tier 1 and from 2.0p to 1.8p per kWh for Tier 2.
The reasons for the 10% reduction in tariffs are as follows:
- The 100% scheme trigger was exceeded this quarter for the first time. This applies a 5% reduction to any tariff which has exceeded its individual expenditure threshold. In this case, Small Commercial Biomass again exceeded its individual expenditure trigger.
- Following a tariff reduction of 10% in the previous quarter, forecast expenditure has grown over the last quarter by more than 50%, but less than 150% of the anticipated growth rate. This applies an additional 5% reduction.
The good news, however, is that as the rate of growth of the Small Commercial Biomass category did not exceed 150% growth rate, the anticipated 20% degression in tariffs has not been triggered.
Medium and large scale commercial biomass boilers (200kW and above) are not affected by this announcement.
If you would like to find out more about this, please contact a member of our team on 01397 706412.