CHP users are missing out on incentives

Almost one in six UK organisations are missing out on attractive financial incentives on their combined heat and power (CHP) systems, due to a failure to register for the Combined Heat and Power Quality Assurance programme (CHPQA) says ENER-G Combined Power Ltd.


Chris Marsland, Technical Director for ENER-G Combined Power explained: “CHP schemes must be certified as ‘good quality CHP’ under CHPQA to access various incentives, including reduction or exemption from the Climate Change Levy;  qualification for Enhanced Capital Allowances; preferential treatment in the EU Emissions Trading Scheme; exemption from business rates and exemption from the Carbon Price Support Levy.”


The latest data shows that of approximately 1450 UK CHP schemes that could qualify for ‘good quality’ CHPQA benefits, around 250 have failed to register and comply with the scheme.

ENER-G has launched a specialist CHPQA registration and submission service to help organisations comply with the scheme and qualify for tax benefits.


CHPQA is a voluntary initiative, providing a methodology for assessing the quality of CHP schemes according to energy efficiency and environmental performance. As such, CHP is assessed on its power efficiency and by a Quality Index (QI), which is a measure of the overall energy efficiency and delivery of primary energy saving.


To achieve ‘good quality’ certification schemes must achieve or exceed the threshold criteria. These criteria are a QI rating of 100, and power efficiency of greater than 20%.  These ratings are achieved by examining data for fuel used, power generated and heat supplied. The thresholds are also designed to meet the requirements of the European CHP Directive.


By achieving or exceeding these minimum standards, schemes qualify as ‘good quality CHP’, which is a pre-requisite for the major fiscal incentives. Failure to achieve the threshold results in a scaling back of the fuel and/or electricity that will qualify for tax benefits.

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