Domestic Renewable Heat Incentive (DRHI) is closing
The Department for Business, Energy and Industrial Strategy (BEIS) announced that the Domestic Renewable Heat Incentive (DRHI) will close at midnight on 31 March 2022. This includes applications to register Metering and Monitoring Service Packages (MMSP).
MCS has prepared a handy guide on everything our installers and your consumers need to know prior to the closure of the DRHI. Our aim is to enable you navigate the process and guide consumers who wish to make a successful application for the DRHI ahead of the deadline.
What installers need to know
Installers must ensure that customers have all the required paperwork for a proper made accreditation application to join the DRHI main scheme. This includes the MCS certificate and other documentation, including an EPC certificate.
To qualify for the DRHI before closure, an installation must be commissioned by the deadline.
If the installation needs metering for payment, all the required meters must be installed and the customer given the required paperwork.
A full checklist of necessary documentation can be found in the Ofgem guide to making an application to the DRHI.
The customer must submit a properly made accreditation application for the DRHI to Ofgem themselves by midnight on 31 March 2022. This is because they must make declarations and understand the ongoing obligations of the DRHI main scheme.
Important: Installers can advise but are not permitted to complete an application on a customer’s behalf.
We recommend that you advise your customers on the best option for their needs. Customers will need to decide whether to apply for the DRHI before the deadline or wait until the Boiler Upgrade Scheme (BUS) launches (expected in April 2022).
Any installations commissioned before 1 April will not be eligible for the BUS, even if a customer missed the DRHI application deadline. There is no flexibility on this, so clear communication is key.
The closure of the DRHI will not affect any installations that currently claim under the scheme.
What consumers need to know
To qualify for the DRHI, consumers must use an MCS certified installer.
You must obtain all the required paperwork from an installer to make an accreditation application to join the DRHI main scheme.
Ofgem will only accredit applications that are ‘properly made.’ To ensure that you can make a properly made application, consumers must have all the necessary paperwork, including an MCS certificate.
Ofgem has prepared a quick guide to making an application to the DRHI. This document provides clear, brief instructions on what documentation is required. It must be read alongside the essential guide, which provides all relevant detail.
You will need to decide whether to apply for the DRHI before the deadline or wait until the Boiler Upgrade Scheme (BUS) launches (expected in April 2022).
Any installations commissioned before 1 April will not be eligible for the BUS, even if you miss the DRHI application deadline. There is no flexibility on this, so ensure you have enough time to submit a properly made application for the DRHI if you wish to access it.
In the run up to the closure of the DRHI, certain scams may unfortunately arise. While MCS actively investigates scams, we always advise consumers to be vigilant. Scams come in many forms, and if something sounds too good to be true, it likely is. If you have any concerns, please contact the MCS Helpdesk on 0333 103 8130 or email@example.com
How MCS is protecting consumers
In the run up to the closure of the DRHI, MCS is increasing its auditing and inspection processes to ensure installations are compliant:
Installation data from the MCS Installation Database (MID) will be analysed regularly. This may trigger further action to be undertaken by MCS where deemed necessary, which may include installation assessments.
MCS installation assessments will be undertaken in accordance with the requirements set out in the MCS Licence Agreement and Mark Regulations (audits and compliance monitoring). Contractors will be required to submit any documentation requested.
MCS assessments will include checks to ensure:
- Products, installations and workmanship are compliant with MCS and legal requirements.
- Comprehensive handover documentation has been issued to the customer, as required.
- All necessary permissions and approvals have been sought prior to installation.
- Compliant sub-contract agreements are in place, where applicable.
Non-compliant installations may result in MCS certificates being removed from the MID.
Please note, Ofgem will also be undertaking its own audits that are independent of MCS.
What is the Domestic Renewable Heat Incentive?
- The DRHI is a government financial incentive to encourage the use of renewable heat.
- Its aim is to cut carbon emissions and help the UK meet its renewable energy targets.
- People who join the scheme and keep to its rules receive payments every three months for seven years.
- In April 2022, BEIS is expected to launch the Boiler Upgrade Scheme, which will replace the DRHI with a one-off grant scheme. Consumers will have to choose between applying for the DRHI or waiting for the BUS.
The Domestic Renewable Heating Incentive vs. Boiler Upgrade Scheme
The closure of the Domestic Renewable Heating Incentive coincides with the launch of its replacement incentive, the government’s new Boiler Upgrade Scheme (BUS).
The DRHI and the BUS are different in the way that they provide some financial support to a consumer installing renewable heat:
|Tariff based payback scheme introduced in 2014 and closes 31 March 2022||Grant scheme set to launch in April 2022 (date TBC)|
|7-year scheme||3-year scheme (provisionally) comprising £450million over 3 years|
|Consumers receive quarterly payments to cover the cost of installation over 7 years||Consumers apply for a one-off grant payment of £5,000 towards the cost of an ASHP or Biomass installation; or £6,000 towards the cost of a GSHP installation|
|Technology covered includes: air-source heat pumps, ground-source heat pumps, solar thermal, biomass boilers, biomass pellet stoves||Covers air-source heat pumps and ground-source heat pumps; biomass boilers only in limited circumstances. Solar thermal is excluded|
|Consumers must apply to Ofgem, not installers||Installers lead voucher application|
|Quarterly payments made over 7 years||Flat, upfront grant|
|Eligible installations: Homes on and off the gas grid; Single domestic dwellings – owner-occupiers, private landlords, social landlords, and people who build their own homes.||Eligible installations: Homes and small non-domestic buildings on and off the gas grid; Owner-occupiers, private landlords and people who build their own homes (custom-builds) NB. New buildings and social housing will not be eligible for support.|
|EPC certificate is OK if less than 2 years old||EPC issued in the last 10 years|
We strongly recommend that consumers consider the differences between the DRHI and BUS.
Installations should be installed and commissioned in line with the incentive a consumer wishes to claim for, providing all Ofgem eligibility criteria is satisfied:
- Only systems commissioned by midnight on 31 March 2022 will qualify for the DRHI.
- To qualify for the BUS, your system must be commissioned from 1 April 2022 onwards; if it is commissioned before, it will not be eligible for the BUS.