Biomass Heating and the Renewable Heat Incentive

About us Headquarters in Fort William Staff located across Scotland Currently employing 30+ staff Design, Build, Operate, Fuel and Own biomass systems

130 Projects across Scotland

The Renewable Heat Incentive What is it? –“A transformation in the way we heat our country” –Greg Barker, Minister of State, DECC, 10 th March 2011 Why? Good News: –Annual, guaranteed payment for switching to renewables. Payable for 20 years and inflation uplifted. –Relatively simple to understand –An attractive financial return to encourage investment, particularly against oil –Applies to groups of buildings and individual non-domestic buildings –Any installation completed after 15 th July 2009 is eligible. Not so Good News –No domestic RHI until 2012 and details not confirmed

Types of Projects: Rural Rural Property Sector Large buildings and groups of buildings Produce own fuel Project Type –50,000 litres of oil = 130 tonnes CO2 –300kw boiler –£250,000 investment –Oil 60p per litre = £18,000 RHI impact = £20,000 per annum for 20 years.

Projects and RHI: Small B&B or Small Guest House Purchase boiler and pellet fuel Project Type –4,000 litres of oil = 8 tonnes of CO2 –30kw Boiler –£25,000 investment –Oil 60p per litre = £800 RHI impact = £3,000 per annum for 20 years.

Projects and RHI: Mid Mid size community sector Heat Supply Contract Project Nature –35,000 litres of oil –150kw boiler –£200,000 investment –Oil 60p per litre = £4,000 RHI impact = £15,000 per annum for 20 years.

Projects and RHI: Large Large Hotel Heat Supply Contract Project Type –120,000 litres of oil = 300 tonnes CO2 –600kw – 1MW boiler –£450,000 investment –Oil 60p per litre = £25,000 RHI impact = £45,000 per annum for 20 years.

Projects and RHI: Very Large Industrial Sector Heat Supply Contract Project Type –3,000,000 kWh per annum+ –1MW boiler + –£500,000+ cap ex –Oil 60p per litre = £120,000+ –Bulk delivery of chip via artic RHI impact = £80,000 per annum + for 20 years.

ESCO Contracts Not everyone has the capital to invest RHI allows for others to own the heating equipment and the RHI payment and sell renewable “heat” This allows cost and carbon savings to be achieved without capital outlay. Offer significant immediate savings against oil (circa 50%) and some savings against mains gas.

“Soft” Loans “Green Bank” – details & remit still uncertain. Scottish Government have allocated £2.5m interest free loan fund to district heating schemes – now open for expressions of interest Carbon Trust have partnered with Siemens to develop a £540m loan fund – commercial rates, accessed via partner companies Other commercial solutions are available: the co-op bank are the leading provider.

Conclusions RHI is a long awaited announcement that will revolutionise our heating sector. Offers a financial incentive to do the right thing Particularly attractive to people currently heated by oil Great opportunity for Scotland and Rural Scotland to both benefit from affordable heating and the supply chain opportunities. For more information: Tel