Domestic Biomass RHI Loan

Challoran

Hello everyone


I'm thinking of having a domestic Biomass boiler fitted to our house, the install would be £30K, but the RHI (Renewable heat incentive) would be £45K over 7 years.

This works out at about £1600 a quarter (the RHI is paid per quarter)

I would like to know if there are any tailor made loans out there for this type of installations, where RHI payment is the same as the loan payment.

So for arguments sake, the £30K loan would be paid at £540 per month for 5 years (or what ever the term / rate is) once the loan is paid off and then the last 2 years of the RHI is profit in my pocket.

I have spoke to the bank, they think the Biomass is a great idea, but they don't offer this product, its just a loan they offer.

Any ideas would be great as the RHI Offer seems a very good option.

Thanks


Craig

Caz3121

Challoran wrote: »

So for arguments sake, the £30K loan would be paid at £540 per month for 5 years (or what ever the term / rate is)

so you are looking for a loan of 3% APR to get those figures to stack up. Unsecured loans are capped at £25k so you would be looking for a secured loan/addition to your mortgage. These will be dependent on your current equity and income

Challoran

Thanks Caz, the interest rate is not important, its just a idea of the product,

dealer_wins

Challoran wrote: »

Thanks Caz, the interest rate is not important, its just a idea of the product,

Copied from the web, dont know if this helps.

Pros

• Of all the technologies you install for heating biomass offer the greatest reduction in carbon footprint per £ spent
• The KWB we used is able to control the existing Gas boiler and use it as backup
• Biomass boiler installations cause no more disruption than would maintenance on your regular boiler. No need to rip up your floors or garden as you might for a ground-source heat pump installation.
• Biomass boilers use very little electricity
• Biomass boilers can use waste wood (turned into pellets)
• Biomass boilers can use locally-sourced biomass helping your local economy
• Biomass boilers are a resilient technology when used with other local microgeneration such as photovoltaics
• Biomass is very clean – you cannot see nor smell any smoke – ever!
• The ash from a biomass boiler takes up hardly any space. When necessary tip it on your garden as fertiliser.

Cons

• Biomass boilers are expensive coming in at anything upward of £9000. You could get quotes for well over £20,000 so shop around. Even if replacing oil it is hard to see a payback without an additional incentive such as the RHI or a cheap on-site source of fuel such as wood chip.
• It was really hard to find a domestic installer (or was in 2008/09).
• Don’t forget you will need a buffer tank and storage space for the fuel. We suggest allowing the sort of space in which a small car would fit.
• Biomass boilers are not really suitable for small homes on the gas grid. They are more beneficial if you have a very large building (ie, farm house, community hall, church, school, etc.) off mains gas.
• Biomass fuel will cost as much as using Oil so there are no direct costs savings if you are on mains gas.
• Your Biomass boiler deserves to be maintained properly. The UK market is only very slowly gearing up so you might be limited in choice. Your average Corgi registered plumber will not touch it.
• Our KWB boiler’s controllers are sophisticated to the point of being too complicated. Refuelling from bags can be physically demanding. This makes them unsuitable for social housing, the physically impaired or the elderly.
• Fuel delivery can be inconvenient (as for any solid fuel) so we normally take the day off work or pay extra for Saturday delivery. Delivery to narrow cul de sacs are a problem in our experience so we always specify a small 8 tonne truck – sometimes this message doesn’t get through and we have had to push pallets from the road on a pallet trolley with the help of the delivery driver. This is almost impossible for a one tonne pallet, we recommend ¾ tonne pallets or less. A tail lift truck is recommended. We always end up part-hand-stacking some of the load to reduce its footprint in the garage. For one fit man this might take 40 minutes to shift 1.5tonnes of bagged pellets (15kg per bag). The other option is to use a large hopper with the pellets blown in – but this is only suitable for much larger installations than we have.
• Having solar thermal can mean the biomass boiler is hardly used through part of the summer. However it will keep the buffer tank up to operating temperature which is wasteful (although this can be switched off). Our system was sized appropriately based upon our SAP rating so this isn’t a significant problem.

captainhindsight_2

There are plenty of places using the rhi income as the loan security for commercial biomass installations. However I don't know of one actually doing it for domestic yet, if you check out Lombard I have herd rumers thAt they may be doing it for domestic in the near future. So may be worth a call.

An alternative would be a free boiomass boiler, this would be a company pays for the installation they get the rhi income and you get a new boiler and cheaper running costs than any alternative for no capital cost.

Based on that income I am guessing you are getting a 40kw boiler, 30k is a good price for that.

Challoran

Hi Guys


Thats for that, I'm already sold on the biomass, and going to pay for it myself, as its just too much of a good deal.

The free offer for domestic is not correct, I've looked into it, and the RHI for domestic can only be claimed by the house holder.


thanks

captainhindsight_2

Challoran wrote: »

The free offer for domestic is not correct, I've looked into it, and the RHI for domestic can only be claimed by the house holder.

Obviously didn't look into it far enough or think out side the box.

It can be claimed by the owner or occupier, the company rents the floor the boiler isbsat on and becomes a co-occupier and is thus able to claim the rhi. Its being done and is happening.

Also announcement made over the weekend by decc coming soon domestic rhi payments will be able to be paid to a third party just like fit with out the need to co-occupy.

This change should make it easier to make the rhi payments security on loans.

Your right it is a good deal, I am investing all my savings in 'free' biomass installations for domestic and commercial and even selling some of my btls

Clive_Woody

PaulGates wrote: »

Hi Craig, there might be a way to get financing for your RHI. I used a firm that did boimass, RHI and Green Deal too plus they were able to offer my finance too - so that gave me peace of mind. I think they were called $$$ Heating, defo worth a look - esp. if they can get you financing too.

You've managed 4 posts with at least 3 of them recommending the same heating company.

Can't imagine who you work for.

canadianmoose

"There are plenty of places using the rhi income as the loan security for commercial biomass installations".


Could you tell me which finance companies/institutions are offering that product?