RHI overspend ‘could be as low as £60m – not £500m’

Andrew Trimble (executive chairman of the Renewable Heat Association NI, which is taking the case), and Tom Forgrave (its director), at the High Court
Andrew Trimble (executive chairman of the Renewable Heat Association NI, which is taking the case), and Tom Forgrave (its director), at the High Court

The amount of overspending on the disastrous RHI scheme may be vastly smaller than has been touted, the High Court has heard.

That was the submission put before judge Mr Justice Colton in Belfast on Thursday, as the latest hearing into the judicial review concerning the scheme got under way.

The case is being taken by the Renewable Heat Association NI (RHANI) and is aimed at overturning cuts to RHI claimants’ subsidies earlier this year, after the full scale of the problems with the scheme were publicly exposed.

Barrister Gerald Simpson QC told the court that whilst the department’s estimate of the overspend is £500m, the true figure could be as low as £60m.

Delivering a de facto solo address to the court for the second day running, after having opened the case on Wednesday with ferocious criticism of the department, he said the department’s estimate of a £500m is “based on assumptions that nothing can be done” to drop the scheme’s cost.

For example, he maintained it has always been within the power of the department to take action against people who were abusing the system.

“The department has the right to obtain repayment of any overpayments, and there’s no evidence that has been done,” he said.

He said: “Everything has been put into the £500m calculation to get the headline figure that has been trumpeted by the department over the period since this became an issue.”

In its calculations, he said the department had failed to take into account inflation, boilers breaking down and dropping out of the scheme, and people being disqualified after inspections.

When all factors are taken into account, the bill could be cut to £161m, he said.

However, this £161m figure also includes two RHI heat-and-power plants which were earmarked to be built; a development the court was told now looks unlikely.

If they were removed from the equation it could bring the overspend down by another £100m – so, in summary, “the appropriate figure to weigh in the balance” when considering the overspend is either £161m or £60m.

He said that for the department responsible for the scheme (formerly DETI, which has since become the Department for the Economy) to complain that the Northern Irish RHI scheme was over-generous when compared with the regime in Great Britain was “egregious” and “fundamentally quite breathtaking in its hypocrisy”.

He said: “The department specifically rejected the Great Britain scheme as not being suitable for Northern Ireland ... What was absent because they chose to do that was the tiering of tariffs and the degression [two crucial cost controls in the scheme].

“It is precisely the absence of the tiering of tariffs and the degression that’s at the heart of the problem in this case.”

He said that not only had the department designed the Northern Irish scheme itself, but had also specifically opted not to mirror the crucial cost control safeguards which existed in the Great Britain version of the scheme.

As in the previous day, some RHI users and those campaigning for them watched proceedings from the court benches throughout, including top RHANI figures Andrew Trimble and Tom Forgrave.

The case is set to resume in the High Court again on Monday.