‘Cash for ash’ overspend may be as low as £60m, court told

Counsel for group of 500 boiler owners says claim taxpayer faces £500m bill ‘flawed’

The falloout from the potential Renewable Heating Incentive overspend led to the collapse of Stormont’s powersharing administration at the start of the year. Photograph: Charles McQuillan/Getty Images.

The falloout from the potential Renewable Heating Incentive overspend led to the collapse of Stormont’s powersharing administration at the start of the year. Photograph: Charles McQuillan/Getty Images.

 

The projected overspend arising from Northern Ireland’s Renewable Heat Incentive scheme could be as low as £60million, the High Court in Belfast has heard.

Counsel for a group of boiler owners claimed the estimated sum represented less than 0.1 per cent of the annual £11billion block grant from Westminster.

Disputing predictions that the botched initiative - also referred to as the ‘cash for ash” scheme - will leave taxpayers with a bill of nearly £500million over 20 years, Gerald Simpson QC said: “It’s an flawed an assumption as we have seen.”

A judge was also told of fears that new tariff rates at the centre of a legal challenge could result in thousands of job losses.

More than 500 members of the Renewable Heat Association NI Ltd are seeking to judicially review the decision to reduce payments assured under the original 2012 regulations. They argue there was no legal power for the move announced by the Department for the Economy.

Under the scheme businesses and other non-domestic users were encouraged to move from using fossil fuels to renewable heating systems. But with operators legitimately able to earn more cash by buring more fuel, the cost to the public purse has been projected at up to £490 million - a figure disputed by the association.

The debacle led to the collapse of Stormont’s powersharing administration at the start of the year and a public inquiry into the matter is being chaired by retired judge Sir Patrick Coghlin.

Earlier this year, former economy minister Simon Hamilton set out revised RHI regulations as part of cost-cutting proposals, which lawyers for the association contend was an illegal step against boiler owners with 20-year contracts.

They allege that the whole scheme was let down by incompetence, hopeless oversight and failed opportunities to impose cost controls