Renewable Heat Incentive – Farms

Renewable Heat Incentive eligibility is not clear for farms and similar organisations. However we believe that it is possible for a farm to qualify for the non domestic Renewable Heat Incentive to heat their home and an acceptable farm building as part of a district heating system.

Ofgem provide a detailed guide Ofgem Website and helpline support 0845 200 2122 to clarify questions and the information here is a guide. Each scheme would have to be approved by Ofgem.

Difficulty 1 – Business rates

Farmers do not pay business rates and this is the way that Ofgem defines a “building”. Therefore applications will have to show that the building is indeed a building that is exempt from business rates and used for agricultural use e.g. farm office. This could be a letter from the local council.

Difficulty 2 – Complex heating systems

If a farm house and office are 2 buildings then they are almost certainly separated and will need some form of well insulated underground heating pipe. There is a small heat loss from this, and as such the payments need to be based on the delivered heat. In order to make this happen meters need to be placed inside the relevant buildings where the pipe has to travel between one building an another.

If there is a back up heating source, such as an oil boiler, then then the heat produced from this will also have to be measured, as will the heat produced from the renewable source e.g. log boiler.

Therefore is is possible for 3 or 4 class 2 heat meters to be needed as part of an installation. This will increase costs accordingly.

For instance a 20kW log boiler in a “complex” system may cost between £8-12k to supply and install.

If a farm used 1314 hours of heat during a year they could gain over £43,000 (1314*8.3*20)

If you consider a farm may be in an off gas area and be making significant gains by burning biomass rather than oil or LPG then this is an excellent investment.

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