In March 2011, the UK Government announced the details of their Renewable Heating Incentive (RHI). RHI is designed to provide financial support that encourages individuals, communities and businesses to switch from fossil fuel for heating, to renewables such as wood fuel.

There will be two phases for domestic customers:

Phase 1 (available from July 2011)- "RHI Premium Payment"

This is called the "RHI Premium Payment" and will be worth around £15m and available to 25,000 householders in Great Britain who install from July 2011.

The exact amounts available to consumers have yet to be confirmed. However the Department of Energy and Climate Change (DECC) have announced that the following amounts may be available:

• Solar Thermal- £300/unit
• Air Source Heat Pumps- £850/unit
• Biomass Boilers- £950/unit
• Ground Source Heat Pumps- £1,250/unit

These are one off payments; so not annual, DECC plan to publish details of the "RHI Premuim Payment" and how this will apply in May this year though recipients of this payment will need to ensure that:

• They have a well-insulated home based on it's energy performance certificate;
• They agree to give feedback on how the equipment performs. Further guidance, including how to apply will appear in May.

Phase 2 (available from October 2012)- RHI Tariffs

People in receipt of the Renewable Heat Premium Payments will be able to receive long term RHI tariff support once these tariffs are introduced, as will anybody who has installed an eligible technology since 15th July 2009.

These tariffs payments will start alongside the Green Deal from October 2012 to allow a more whole-house approach to heat production to heat production and energy saving.