The amount of money householders can expect to be paid for fitting "green heating" was published for the first time on Thursday, revealing most homeowners installing solar hot water systems are unlikely to recoup their initial outlay for more than 30 years.
The renewable heat incentive (RHI) will reward households for each unit of low-carbon heat generated from solar thermal panels and other renewable heating systems such as biomass boilers and ground-source heat pumps.
The scheme was due to launch this October but the government delayedit earlier this year. It will now launch in summer 2013 and the subsidy payments will be made over a period of seven years.
For oil-heated homes off the gas grid that install a £3,000 solar hot water system, owners would receive roughly £200 per year in RHI payments for seven years, in addition to an ongoing annual £80 in bill savings, meaning the upfront cost would be recovered in 20 years.
However, most homes are currently heated by cheaper gas and will struggle to recoup their investment for more than 30 years at the proposed rates, only getting back around £250 a year on bill savings and payments. Most solar thermal systems cost between £3,000-£5,000.