Government urged to create pro-business heat pump tariff

06 April 2010

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Businesses are being overlooked in a new drive to switch more of the UK’s heating over to renewable energy sources, according to a leading supplier and installer of ground source heat pumps. A new tariff that rewards those who switch to lower-carbon forms of heating is unfairly biased towards home-owners and the housing market, says Geothermal International.

“Geothermal International welcomes the Government’s Renewable Heat Incentive initiative but has serious concerns over the tariff rates being proposed to incentivise businesses,” said Geothermal Sales and Marketing Director Patrick Sheriff. “The proposed rate for large-scale GSHP systems over 350kW is simply not big enough to kick-start the industry — and as this is the size of system which is best suited to many businesses that poses a problem.

“The Government is in danger of failing to meet its own targets because the Renewable Heat Incentive does not offer enough to businesses which, after all, have collectively a huge potential for reducing carbon emissions.

Sheriff says that the tariff needs to be set at a level where the payback is in the region of six to seven years for a business — and the proposed rate of 1.5 pence per kW hour for for GSHP systems over 350kW is woefully inadequate.

Carbon-saving potential for business

“The tariff needs to be set at a level where the payback is in the region of six to seven years for a business – and the proposed rate of 1.5 pence per kW hour for for GSHP systems over 350kW is woefully inadequate. Tariffs are far more generous for small installations under 45kW than they are for the sort of larger installations that businesses would adopt — and yet the carbon savings potential for businesses is vast.

“While it is admirable that the Government wants to encourage owner-occupiers and landlords, particularly social landlords, to switch to renewable energies such as GSHP and air source heat pump systems, surely it also wants to see the full potential of energy savings realised across all sectors, particularly business."

Geothermal is calling on the Government to reconsider the weighting of the tariffs so that businesses and large-scale public organisations such as schools, hospital and colleges do not miss out.

Adds Sheriff: ”If the Government is really serious about getting a step change in the use of renewable energy, it should take a second look at the Renewable Heat Incentive.”

 

 

 
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