Why the RHI matters for small businesses

Why the RHI matters for small businesses

New research from the Federation of Small Businesses (FSB) shows what small-business owners really think about the future of energy in the UK.

FSB recently asked its members what mattered most to them when it came to the future of energy in the UK.

While energy security and affordability are important to respondents, almost one in five said that reducing emissions was the most important aspect of energy policy from their point of view.

This shows how high awareness is among small-business owners of the need for low-carbon energy solutions like sustainable wood pellets. It’s also in line with our own experience here at Billington Bioenergy.

More than one in four respondents also said they believe that low-carbon energy will create more opportunities than threats for their businesses.

One pair of members in particular were very clear about the need for support for business-owners to invest in sustainable energy.

John and Ceilia Whitehead run an eco guest house in Snowdonia National Park. They have won many awards for their sustainable approach to tourism and have been keen to reduce their carbon footprint as much as they can. They explain that “for us, carbon reduction and sustainability are part of our philosophy, our way of life.”

But even the most dedicated supporters of heating from sustainable wood pellets need a helping hand sometimes. As John and Celia say: “Without the contribution of the Renewable Heat Incentive (RHI), we wouldn’t have been able to justify the upfront investment costs. As well as reducing the overall cost burden, RHI also provided us with a secure investment model and reduced the pay-back time of the project, which made us a more attractive proposition for lenders when we looked for a finance package.”

The RHI helps to make wood pellet boilers more affordable by enabling owners like John and Celia to reclaim some of their initial costs every year.

The other advantage of wood pellets for heating is that the price tends to be very stable, and isn’t as volatile as that for heating oil tends to be. In fact, the current price for wood pellets is cheaper than heating oil*

This price stability can make biomass heating very attractive for businesses and homeowners, because it can enable them to plan their costs very accurately in the medium term.

You can read the full report from FSB here.

*Correct as of 12/01/2017
Wood Pellets: 3.75 pence per kWh
Heating Oil: 4.8 pence per kWh

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