RHI biomethane degression clarified

Following the RHI biomethane tariff announcement in December, several members have contacted us for clarification on the way in which the first degression of new tariffs will be calculated for July 2015. 

Our understanding, as explained in our (now updated) briefing, was that the normal calculation would be applied – i.e. the degression is not 'cumulative' if there would have been a degression in April 2015 without the protection that the new regulations put in place. However, some members were concerned that DECC's consultation response was not sufficiently clear on this point. 

We therefore asked DECC for clarification, which they have provided by email as follows:

The calculation to determine the level of degression that will be applied on 1 July will consider whether a degression ‘should’ have happened on 1 April and takes that into account for the calculation of whether ‘C’ as per regulation 37 D is 0.05, 0.1 or 0.2. The April degression is not stored up and applied to the new tiered tariffs in addition to whatever the calculation comes up with for 1 July.

The reference to calculating 'C' refers to the fact that degressions depend on what has happened since the previous degression point, as well as the levels of projected expenditure in biomethane and the scheme as a whole. We are updating the guidance we provide in the members' area to provide more information on how this is calculated, but for now please contact the policy team with any questions, via Matt Hindle.