Closure of RHI scheme will put NI agriculture at a serious disadvantage, says UFU

According to the Union, the closure of the scheme will put the NI agriculture industry at a competitive disadvantage to its counterparts as the scheme in England, Scotland and Wales continues to operate. It will also create an energy border in the Irish Sea and on the island of Ireland.

In October 2020, the UFU wrote to Department for Economy (DfE) Minister Diane Dodds seeking a meeting to discuss the prospective of closing the scheme. This was never obtained.

The NI Executive has now instigated a public consultation explaining their intentions to close the RHI scheme. At the launch, they stated that they already have a ‘preferred option’. The UFU say they are extremely concerned about this statement as a proper consultation is normally held when the proposals are at a formative stage and it could lead boiler owners to assume that there will be a pre-meditated outcome.

Within the consultation it states it will compensate RHI participants. The financial package, which is one of four options in the consultation, outlines that it will cost £68m to buy out the 1,200 businesses in the non-domestic scheme. Estimations indicate that the average participant will be eligible for a pay-out of up to £35,000 per boiler.

UFU deputy president David Brown said: “We have no confidence in the DfE’s calculations which they have based their proposals on. Suddenly we have moved from an overspend to a huge underspend. The reduction in 2017 to £12,000 per boiler eliminated the overspend. Yet, in 2019 it was reduced further to £2,000 per boiler creating an underspend in 2019/2020 of over £22m and an anticipated underspend of £26m this year.”

The UFU say NI’s carbon emissions have reduced by seven percent since the introduction of the RHI scheme and its closure will inevitably cause a shift back to fossil fuels.

“The UFU have been questioning the NI Executive about how they are going to prevent an increase in the use of fossil fuels especially when we are doing all we can to work towards net zero carbon emissions. It’s deeply worrying and questions the policy foresight of the DfE,” added Mr Brown.

“There is already a policy vacuum at Stormont and with the new NI Energy Policy running over time, it is unlikely to see the light of day until next year at the earliest. Yet the call for evidence results published by DfE, identified heat and transport as being the key areas in meeting carbon emission reduction targets,” said Mr Brown.

The UFU is also concerned that the eight-week consultation period, closing on 9 April, is not long enough to consider and review all responses appropriately.