For the Domestic RHI, a single tariff rate applies for water-source heat pumps. The latest rate is published by Ofgem here. We expect this rate to remain the same until the Domestic RHI scheme closes for new applicants on 31 March 2022.
For the Non-Domestic RHI, there are different tariff rates for water-source heat pumps depending on whether the project is above or below 100 kW. In addition, the tariffs are split into Tier 1 and Tier 2. Each year, Tier 1 applies until payments have been made against heat equivalent to operating at full capacity for 15% of the year (1,314 hours). Any further payments are made at the Tier 2 rate. The latest rates are published by Ofgem here.
The Non-Domestic RHI is affected by ‘degression’ i.e. regular reduction of the tariff rates. There are several triggers for degression, related to deployment of projects both for specific technologies and for the Non-Domestic RHI as a whole. Water-source heat pump projects below 100 kW are not currently subject to degression. Projects at 100 kW and above are experiencing quarterly degression of approximately 10-20%, so where possible projects should submit Stage 2 Ofgem applications as soon as possible, to minimise rate reductions.
A clear understanding of the RHI rules is important to achieve a successful project. Please contact us for advice on your project.
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Once complete, you will understand the site potential and be guided through the next steps to develop your project.