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Ireland’s Renewable Heat Obligation: a policy precedent for the UK?

On 18th July, the Irish government announced the introduction of the Renewable Heat Obligation Scheme (RHO). It will be launched in 2026 and remain in place until 2045. The announcement is a significant step forward in efforts to secure the use of renewable liquid fuels in heating and comes at a time when all indicators suggest Ireland is failing to meet the carbon reduction targets set out in its Climate Action Plan.

This could result in Ireland having to pay out billions of Euros in fines to its EU partners if it does not step up climate action. 

The announcement suggests the Government has recognised that heat pumps alone cannot deliver heat decarbonisation - or at least not quickly enough. Heating buildings accounts for approximately 10% of Ireland’s emissions, and the RHO, while not being a panacea, will make a significant contribution. Initially, fuel suppliers must provide 1.5% of their fuels from renewable sources, rising to 3% in year two, both of which are very low blend levels.

Concerned at the lack of ambition, a liquid fuel industry campaign group, the Alliance for Zero Carbon Heating (TAZCH), recently met the energy minister, Darragh O'Brien, and made the case for higher concentrations. TAZCH proposed that a 20% blend of renewable liquid fuels, such as HVO, can be implemented. This would have a very significant impact on the 700,000 households in Ireland currently using home heating oil – 60% of which are in rural Ireland and would provide the same carbon savings as installing 160,000 heat pumps immediately. It has since been confirmed that the Department are now considering a higher rate for liquid fuels from year one and that they are looking at the cost of 5%, 10%, 15% and 20% blends, and at the availability of adequate fuel renewable stocks.

These developments are good news for the environment, consumers, and the liquid fuel heating industry. They also set a timely policy precedent that could be repeated in the UK, because the UK government is due to publish its Warm Homes Plan this autumn, which will set out its heat decarbonisation plans for the remainder of this Parliament.

Ahead of this, the Scottish government has already announced its intention to publish a revised version of its Heat in Buildings Bill, which will include support for the use of renewable liquid heating fuels. In answers to written questions in the Scottish Parliament, Màiri McAllan MSP, Cabinet Secretary for Housing, confirmed that “…bioenergy, including renewable liquid biofuels, is a low carbon, renewable energy source which can prove the best solution to decarbonising heating in some remote and rural communities. We intend to ensure that sustainable bioenergy and biofuels remain an option for these communities, and the provisions of our proposed Heat in Buildings Bill will take a technology-neutral approach, so that building owners can choose the technology that is right for them.”

This pragmatism sets a welcome example. The UK government’s Warm Homes Plan will be an important moment for off-grid heating and, bolstered by the developments in Ireland and Scotland, every effort is being made to secure policy backing for renewable liquid fuels as part of this plan.