Renewable Heat Incentive RHI

Solar Panels and The Renewable Heat Incentive

Under the 2009  Renewable Energy Directive, Ireland is committed to produce 12% of our heating demand from renewable sources by 2020.  We are a long way away for this so one of the measures to encourage the take up of renewable heating technologies ( such as solar panels) is to introduce a Renewable Heat Incentive or RHI.

The RHI is a mechanism where you get paid for producing heat form renewable energy sources. For example if you install solar panels to heat water and you produce 2000 kWh of heat per year you will get paid an amount of money per kWh of heat produced.

Solar Panels could be part of a renewable heat incentive

Renewable Heat Incentive could pay for heat generated by solar panels

Bioenergy is expected to contribute significantly to our renewable energy target but it is hoped that other technologies such as solar panels and heat pumps will also be supported. The RHI is expected to be introduced in 2016, we will update this page with more information on how solar panels may benefit from this when the information is released.

In the meantime some abridged information from the Department of Communications, Energy and Natural Resources on the RHI is reproduced below.   The full statement can be read here:

Information from the DCENR website:

"The Draft Bioenergy Plan drawn up by the Department, identifies an additional bioenergy-focussed measure in the heat sector as representing the most cost effective means of meeting a number of different policy goals, including reducing the emerging gap anticipated in the heat sector. The analysis considered various policy options, including increased carbon taxes. It indicated that the option with the least modelled cost is an appropriately focussed Renewable Heat Incentive (RHI). This would provide stability and long term security for investors, ensure better value for money for consumers.


The Draft Bioenergy Plan recommends, subject to further Government and EU Commission State Aid approval, the introduction of a Renewable Heat Incentive (RHI) in 2016 for larger heat users. It would be aimed at larger industrial and commercial installations outside of the EU Emissions Trading System (ETS) to change to heating solutions that produce heat from renewable sources.

The renewable heat support would be based on the principle of providing an incentive payment rewarding users for each unit of renewable heat produced and used, based on a unit rate of payment (tariff) applied to metered renewable heat output. The tariff would be calculated to compensate for the additional capital cost and perceived barriers (including non-financial barriers) for the renewable technology (which could include technologies other than biomass e.g. heat pumps) relative to fossil fuel heating.

It is envisaged that the RHI would be funded by the Exchequer.

Work on the design of the RHI scheme has been commenced by the Department . It will include public consultation, the first stage of which will be launched shortly. The consultation process will seek views on a range of issues including the technologies that should be included.   Once designed, the scheme will require State Aid clearance from the European Commission and further Government approval. Subject to these approvals, it is proposed to have the scheme in place in 2016."