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Probe into contentious renewable energy scheme 'a top priority'

Published 12/10/2016

Robin Swann said the scheme needed to be investigated
Robin Swann said the scheme needed to be investigated

A probe into a renewable energy scheme - dubbed a burning ash-for-cash racket - is a top priority, the Public Accounts Committee (PAC) chairman has vowed.

Robin Swann said those who ran the Renewable Heat Incentive (RHI) - through which a farmer can allegedly pocket £1 million for heating an empty shed - had many questions to answer.

He said: "We will not be deflected. This is most important."

The committee had been due to hear from officials and Auditor General Kieran Donnelly, who outlined the scale of the public overspend in a damning report earlier this year.

However, much of the meeting was held in private.

It was later adjourned to facilitate the conclusion of investigations by the Department for the Economy which replaced the Department for Trade and Enterprise (DETI).

A PAC statement released afterwards said: "The PAC considers this particular inquiry to be of the most acute public interest and achieving maximum transparency and accountability on this issue are paramount.

" The PAC will not be deflected in its determination to fully carry out its political and scrutiny responsibilities."

The RHI encouraged the installation of costly eco-friendly heating systems by paying a tariff per kilowatt of heat burned over a 20-year period.

Thousands signed up to the scheme, which started in 2012 and was extended to domestic customers in 2014. It was administered on behalf of DETI by the Office of Gas and Electricity Markets.

Unlike in the rest of the UK, in Northern Ireland no cap or payment tier system was placed on the money that could be claimed in proportion to the size of boiler, effectively enabling a business to burn unnecessary heat just to make money.

By 2036, more than £1 billion of public money will be paid to Northern Ireland-based businesses after they installed new appliances under the RHI scheme, which is now closed.

In his report, the Auditor General questioned the level of expenditure and claimed major design and operation errors left the initiative exposed to abuse.

He said a business burning a biomass boiler 24/7 in Northern Ireland could make around £864,000 profit in the next 20 years. A business in England burning the same boiler would make £192,00 in the same period.

The scheme was tightened up in November with the introduction of tiered payments, but before the change came into effect there was a surge in applications to sign up to the RHI on the pre-existing no-cap tariff system.

The surge left DETI exposed to a huge overspend if it was to continue to run the scheme and the announcement of its closure to new applicants was made three months later.

It was envisaged the UK Government would fund most of the RHI scheme, but the expenditure commitment in Northern Ireland over the next 20 years is well above a Treasury funding cap, meaning Stormont will need to find hundreds of millions to make up the shortfall.

Sinn Fein MLA Michelle Gildernew said: "There are fundame ntal questions which need to be answered in relation to RHI and it is essential that there is full public accountability.

"There are other ongoing investigative processes into RHI and it was the correct decision by the PAC to adjourn its public session."

Dr Andrew McCormick, from the Department of the Economy, told MLAs: "We are accountable.

"That's the nature of the relationship. We are available as and when you require."

The committee is expected to reconvene on October 26.

Press Association

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