It's speculative, but at least it's a stick in the ground.
This week, the UK government published its consultation on the domestic stream of the Renewable Heat Incentive (RHI), (read the solarblogger's summary here).
The proposed tariff figure for solar heating is 17.3pence per kWh for seven years - but what does this mean in terms of the potential value of the RHI to a household? the solarblogger does the maths.
The energy saved by a solar water heating system is currently estimated for customers by their installer using a calculation published by the Microgeneration Certification Scheme. There is also a consultation in progress for this standard, including updates to the solar energy calculation. I have used the proposed new calculation method.
Occupancy
|
Area of Solar Collector
|
Energy Saving
|
Solar Energy Qs
|
(people)
|
(m2)
|
(kWh/year)
|
(kWh/year)
|
1
|
2.0
|
769
|
590
|
2
|
2.0
|
979
|
752
|
3
|
4.0
|
1,431
|
1,099
|
4
|
4.0
|
1,665
|
1,279
|
5
|
6.0
|
2,092
|
1,607
|
6
|
6.0
|
2,312
|
1,776
|
Assuming that the RHI is paid on the renewable energy input to the hot water cylinder, the value of the RHI and fuel savings are shown below.
Potential RHI Solar Payments for Off-gas Property
Occupancy
|
Annual RHI Payment
|
Annual Own Use Saving
|
Total RHI Payments
|
Fuel Saving
|
Total
|
(people)
|
(oil)
|
(7 years)
|
(7 years)
|
(7 years)
|
|
1
|
£
102.13
|
£
61.49
|
£
714.88
|
£
430.44
|
£
1145
|
2
|
£
130.02
|
£
78.29
|
£
910.12
|
£ 548.00
|
£
1458
|
3
|
£
190.16
|
£
114.50
|
£
1,331.14
|
£
801.51
|
£
2133
|
4
|
£
221.18
|
£
133.18
|
£
1,548.28
|
£
932.25
|
£
2481
|
5
|
£
277.96
|
£
167.37
|
£
1,945.72
|
£ 1171.56
|
£
3117
|
6
|
£
307.21
|
£
184.97
|
£
2,150.44
|
£
1,294.82
|
£
3445
|
For a property heating water with an oil-fired boiler, the value of the RHI plus fuel savings over the seven year period of the RHI would be around £2,500 for a 4-person household (expressed in 2012 prices). Of course, the solar heating system would continue to deliver fuel energy savings after year 7.
Potential RHI Solar Payments for Gas Heated Property
Occupancy
|
Annual RHI Payment
|
Annual Own Use Saving
|
Total RHI Payments
|
Fuel Saving
|
Total
|
(people)
|
(gas)
|
(7 years)
|
(7 years)
|
(7 years)
|
|
1
|
£
102.13
|
£
38.43
|
£
714.88
|
£ 269.03
|
£ 984
|
2
|
£
130.02
|
£
48.93
|
£
910.12
|
£ 342.50
|
£ 1253
|
3
|
£
190.16
|
£
71.56
|
£
1,331.14
|
£ 500.94
|
£ 1832
|
4
|
£
221.18
|
£
83.24
|
£
1,548.28
|
£ 582.66
|
£ 2131
|
5
|
£
277.96
|
£
104.60
|
£
1,945.72
|
£ 732.22
|
£
2678
|
6
|
£
307.21
|
£
115.61
|
£
2,150.44
|
£
809.26
|
£ 2,960
|
For a property heated by gas, the incentive is slightly lower because the saving from fuel use avoided is lower- gas is a cheaper fuel than oil, but (again expressed in 2012 prices) the value of a solar heating system to a 4-person household would be around £2,150 over the first seven years, with energy savings for another 20 years after.
But is it enough?
Given that a solar heating system will cost between £4,000 and £5,000 installed, no-one is going to get rich on this scheme. On the other hand, this level of financial assistance definitely represents a step-change in the level of government support for a very popular, well-understood and readily installed technology.
But is it enough? What do you think? Post a comment below.
Assumptions:
Gas 5p/kWh, Oil 8p/kWh
All prices are 2012 values, no fuel price inflation added.
Solar panel - high performance flat plate
Orientation - South at 30 degrees pitch, no shading
Assumed that RHI is paid on Qs - solar energy input to hot water cylinder
Own use savings based on a modern condensing boiler, but using a "summer-biased" efficiency of 77%, according to draft MIS3001 v3.0.
