21 Oct 2010 10:10:17

Renewable Heat Incentive funding confirmed

More than £800 million of funding for the Renewable Heat Incentive (RHI) will be introduced from 2011-2012, the coalition government has confirmed.

In his Comprehensive Spending Review, Chancellor George Osborne confirmed that the RHI will be going ahead, with funding of £860 million.

The government claimed that this will lead to a ten-fold increase in renewable heat generation for the next decade, "shifting renewable heat from a fringe industry firmly into the mainstream".

Plans laid out by the previous government for a renewable heat levy will not be continued.

The Renewable Energy Association welcomed the announcement, stating that it was a "very big breakthrough".

Gaynor Hartnell, chief executive of the organisation, said: "We need to see the details but it looks like they're serious about supporting massive growth and employment in the UK's renewable energy sector."

She added that currently heat is responsible for 47 percent of the UK's carbon emissions.

Overall, the Spending Review detailed that the Department for Energy and Climate Change will reduce resource spending by 18 percent, but increase capital spending by 41 percent.