In 2019, the support scheme for renewable heat (SSRH) was introduced to assist farmers and businesses with the costs of investing in and operating renewable heating systems.

The aim of this scheme was to improve Ireland’s dismal performance in the renewable heat sector, which currently stands at around 6%, significantly lower than the EU average of 22%.

However, the application process and strict terms and conditions deterred many farmers from taking advantage of the €300m SSRH scheme. As a result, just over 50 farms have been approved for support under the scheme, while 40 other applications from hotels, nursing homes, offices, etc, have also been approved. Acknowledging the low uptake rate, the Government has recently relaunched the scheme by increasing the grant aid level and broadening the range of eligible businesses.

With these revised terms, the Government anticipates that more businesses will participate in the SSRH over the coming years.

What grant aid can I get?

The scheme will provide support for those who use heat, not those who produce renewable fuel – biomass or biogas.

As with most schemes, this will make the most financial sense for farms that use a lot of heat such as pig, poultry and dairy farms.

There are two forms of financial support available to eligible businesses under the SSRH. The first is a 40% grant towards the cost of installing an air, ground, or water source heat pump. The second is a tariff that provides ongoing financial support, paid per unit of usable heat from a renewable heating system, for up to 15 years.

This tariff applies to new heating system installations or installations that switch from fossil fuels. Eligible systems include biomass boilers or biomass high-efficiency combined heat and power plants (HE CHP). Biogas boilers and biogas HE CHP heating systems are also eligible for the tariff. Successful applicants will receive quarterly tariff payments based on heat usage. The 40% installation grant is not available for these systems.

The scheme only applies to businesses transitioning from fossil fuels to biomass or biogas, or installing a heat pump. Farms that are already using biomass for heating will not be eligible for the scheme. Applications can be made through the SEAI’s online portal.

What has changed?

The revised scheme introduces several changes. Firstly, the maximum level of grant aid for heat pump systems has been raised to 40% of the cost, up from 30%.

However, the most significant change is the scheme’s extension to the Emission Trading Scheme sector, which includes large industrial and fossil fuel users. This is subject to State aid approval but will allow most large food and dairy processors in the country participate. Additionally, widening the eligibility criteria means the scheme now supports heat pumps that utilise waste heat sources and are suitable for high-temperature applications, and expands support to the broader use of heat pumps in buildings and district heating schemes. The Government has agreed to keep the maximum support available for biomass applications at €3.5m over a 15-year period. A key design feature of the scheme was that tariff supports decline in line with use and this remains unchanged. So the more you use, the less you get paid. The rationale behind this is that once the cost of installing the system is recouped, the tariff is no longer necessary.

This design feature was likely influenced by the controversy surrounding the Renewable Heat Incentive scandal in Northern Ireland. Although this approach helps to ensure value for money for taxpayers, critics say it does not promote the environment necessary to develop long-term purchasing contracts with biomass and biogas suppliers.

Without assurance of demand and price stability in the long term, it may be challenging for new biomass or biogas projects to secure development funding.

Tariffs

The updated terms and conditions have not been published yet, but it is believed that the tariffs will not berevised. Table 1 shows the level of tariff paid under the scheme.

TAMS V SSRH

Grant aid for biomass boilers and heat pumps is now available under TAMS III and the SSRH. Both schemes offer up to 40% towards the cost of a heat pump but differ when it comes to biomass boilers where TAMS offers a grant while the SSRH offers ongoing tariff payments for 15 years. Both schemes are different, with one falling under the Department of Agriculture and the other under the Department of the Environment, Climate and Communications. Study the terms and conditions of both schemes carefully and weigh up which is the least onerous for you. Remember you can’t double claim.