Savills Energy is urging businesses considering biomass heating under the first phase of the Renewable Heat Incentive, to act now to avoid the 5 per cent reduction in tariff which comes into force on 1st July 2013.

Figures released last week from the Government highlight that biomass heating has received the greatest uptake under the Renewable Heat Incentive scheme. The incentive launched by the DECC in November 2011 aims to support and promote the use of renewable energy to produce heat for industry, business and public sector organisations.

However, the DECC has now said it plans to reduce the tariff for medium commercial biomass boilers (200kw to 999kW) by 5 per cent for new entrants to the scheme from 1 July 2013. It has also launched a consultation on increasing tariff levels for heat generated by ground source heat pumps, large biomass and solar thermal kit.

Duncan Brewer of Savills Energy in Oxford comments, “It seems as if biomass heating has become a victim of its own success. It is disappointing that the DECC has seen fit to reduce the medium scale tariffs by 5 per cent from 1st July. There is a danger that the decision will undermine confidence in the biomass heat sector, yet this should not be the case. Biomass heating is still viable and worth consideration and we are urging businesses considering applying to act sooner rather than later to secure the best possible tariff.”