Government delays key deadline for renewable energy projects

The government has set out plans to delay the deadline for Renewable Heat Incentive (RHI) projects to complete construction and retain tariff guarantees.

Tariff guarantees allow commercial applicants to secure a payment rate under the RHI scheme before a proposed project is completed.

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When the tariff guarantee scheme was launched in May 2018 it came with a deadline for project completion of 31 January 2020.

But the Department for Business, Energy and Industrial Strategy has announced plans to push back the deadline until 31 January 2021.

In a letter to stakeholders the department said legislation would be drafted later this year to ratify the deadline extension.

Savills’ renewable energy consultant Henry Grant explained that the reason for the move was a potential log jam in construction and commissioning of large-scale units.

“The large-scale plants take about a year to construct and there are more than 40 – mostly biomethane units – with tariff guarantees,” Mr Grant said.

The prospect of those units vying for commissioning to the gas network at the same time led to calls for the deadline to be pushed back to ease the pressure.

Mr Grant pointed out that the new deadline only applied to new applications and that schemes with an existing guarantee must reapply to qualify.

However, the shift could still benefit dozens more projects, Mr Grant added.

“This opens up an opportunity for large- and small-scale heat projects to be developed before the closure of the RHI scheme in March 2021,” Mr Grant said.

And projects that had already been awarded a tariff guarantee, but were struggling to complete work in time, will be able to reapply so they can be commissioned at a later date.

Other plants that may have been mothballed, or projects that had received planning permission and were shelved due to the short timescale, may also be restarted, Mr Grant said.