biomass burner© John Eveson/FLPA/REX/Shutterstock

Northern Ireland farm leaders have expressed their “extreme concern” at official plans to extend a cap on payments farmers receive for their biomass boilers for at least another year.

Earlier this year, the Department for the Economy introduced new rules designed to limit expenditure under the controversial Renewable Heat Incentive (RHI) scheme.

In particular, new tiered payments were introduced, limiting RHI payments to 6.7p/kWh for the first 1,314 hours on medium-sized (20kW to 199kW) biomass boilers, reducing to 1.5p/kWh thereafter, up to a limit of 400,000kWh.

This is intended to help deal with a projected £490m overspend on the scheme.

See also: Biomass boilers – do wood pellets stack up?

The new regulations were intended to apply until 31 March 2018, during which time a consultation was to have been held and a new long-term solution to the funding problem agreed.

But the new rules have since been challenged legally by the Renewable Heat Association, representing boiler owners claiming under the scheme, and this is not due to be held in court until October.

A department statement says there is now not sufficient time between the conclusion of this court hearing and the 31 March deadline for a new funding arrangement to be thrashed out.

As such, it is proposing to extend the current capping and tiering arrangement until 31 March 2019.

Financial burden

While acknowledging the need for a long-term solution to be found, Ulster Farmers Union chief executive Wesley Aston said it was “unfair to expect legitimate RHI recipients to suffer financially”.

“These people have made investments in a long-term programme, backed by government, and they should not have to carry the financial burden while we wait on ministers to be appointed and the formation of an executive.”

The Renewable Heat Association went further, saying the “people of Northern Ireland must doubt the words of those who told them the emergency measures were for one year only”.

“These were 20-year, index-linked guaranteed promises,” it said, referring to the original contracts farmers and other businesses had signed under the RHI.