RHI scandal: Almost £1,000 a day for one man’s 10 ‘spike’ boilers

For every �1 worth of pellets burned, the RHI scheme pays out �1.60
For every �1 worth of pellets burned, the RHI scheme pays out �1.60

A business which was only set up as the RHI spike was starting is now making almost £1,000 a day from taxpayers after it managed to install 10 wood pellet boilers just before the lucrative and unlimited scheme was capped.

Eco Biomass NI Ltd was only incorporated as a company on September 1 2015 – days before it was publicly announced by Stormont that the cost controls were to be introduced on a scheme which the department had known for months was financially out of control.

A large number of people who became aware that the scheme was to close installed boilers in that period. The situation was exacerbated when the Stormont department further delayed cost controls.

That means that all those who availed of a government scheme promoted by the government did so entirely within the rules. There is no suggestion that Eco Biomass did anything outside the rules.

Companies House records show the business is owned by one man – 65-year-old Thomas James Spence from Dungannon – but it has not yet filed any accounts.

Even though Mr Spence’s business only began operating right at the end of the scheme, it has had the fourth largest total payment, pulling in £476,383 of public money in the 16 months since the 10 boilers were installed.

The boilers have been used to dry wood chip – which can then be used in either the boilers themselves or sold for use in other boilers.

However, Mr Spence did not have planning permission for the operation when he installed the boilers at a huge warehouse on the side of the Drum Road between Cookstown and Omagh.

Documents from Mid Ulster Council show that the company only applied in May the next year for “retrospective part change of use from waste re cycling depot with compost facility to processing area for the drying of virgin shredded timber, including storage and distribution area”.

That permission was only retrospectively granted on January 18 of this year.

In January, Mr Spence spoke to Ulster Herald journalist Ryan McAleer about the wood-drying operation and defended his RHI claims – although the scale of the payments was not known at that point. Mr Spence said: “We’re a legitimate business providing to power stations and other farmers and other local people, but the bulk of it is not going to other burners”.

Mr Spence also told the paper that he had signed up to an organisation which would be “challenging most things to do with [recent changes to the RHI scheme]”.

He added: “We simply availed of the opportunity that was there and presented to us. There is nothing illegal about that, there’s certainly nothing to be demonised or criminalised about.”

Mr Spence, who has major business interests, including in property development, said that he was concerned at being “criminalised” and accused the media of “scaremongering” in how the RHI scandal had been reported.

Every single one of the Eco Biomass boilers is 99kwth – the maximum capacity boiler for which the ‘burn to earn’ RHI tariffs could be claimed.

By contrast, some of those on the RHI list published on Thursday chose to install single massive boilers meaning that they received far more modest payments which would not have incentivised running the boilers.

For comparison, Sainsbury’s Bangor store installed a 630kwth boiler and its Craigavon store installed a 580 kwth version – between them, a greater capacity than the Eco Biomass boilers combined.

The Sainsbury’s boilers were also installed at a much earlier stage in the scheme in 2013, meaning that it had a much longer period in which to claim. But in contrast to the £476,383 which Mr Spence’s company is making, the two Sainsbury’s stores have between them claimed £69,348.

To put the scale of the claims in context, the two Sainsbury’s boilers – which can deliver a greater heat output than Mr Spence’s 10 boilers – are receiving an RHI payment of just £51 a day, while Mr Spence’s 10 boilers are bringing in almost £1,000 a day (assuming that both applications were approved after the same period of time).

The list published on Thursday – which is available in full on the News Letter website – contained names and amounts for less than 900 of the more than 2,000 RHI boilers. The remainder will be published in coming weeks.