UK: Waste Not Want Not - The Industrial Heat Recovery Support Programme

Last Updated: 26 September 2018
Article by Kenneth Addly


The Government launched the Industrial Heat Recovery Support Programme (IHRSP) on 5th July 2018.

Recovering heat from industrial processes, that would otherwise be wasted, can:

  • Reduce costs for business;
  • Contribute to reducing carbon emissions; and
  • Drive economic growth.

Waste heat can be re-used in an industrial facility for heating/cooling; exported via heat networks to other end-users or converted into power.

Government has identified three barriers to deployment to heat recovery projects:

  • Insufficient knowledge;
  • Technical difficulties of fitting heat recovery technology;
  • Availability of capital and amortisation - investors look to a return of the invested capital, through savings, within a three year window, but waste heat projects tend to have longer amortisation profiles.

IHRSP – Programme and Process

IHRSP is designed to tackle these constraints and will run from 2018 to 2021.

BEIS considers that a relatively low level of financial support through IHRSP could make a significant dent in the constraints and has the potential to reduce total industrial energy bills by over £500 million over IHRSP's lifetime.

IHRSP will comprise two phases of funding:

  • Phase 1 – funding for feasibility studies, sourcing opportunities on sites and cost/benefit assessments. The total pot available will be £6 million;
  • Phase 2 – capital support to help project delivery. The total pot will be £12 million.

The first Phase 1 applications will be made in in autumn 2018.

IHRSP only applies to England and Wales.

Originally IHRSP was only to be open to industrial manufacturing sectors as set out in ONS Standard Industrial Classification Codes 10-33. Respondents to the Government consultation suggested a widening of the scope. Government is now minded to extend IHRSP to Data Centres which could help unlock a potentially valuable income stream for operators in this growing sector.

IHRSP will only be available for fully commercialised technologies, but otherwise is technology neutral.

The programme will not distinguish between renewable/non-renewable origins of the generated heat. Recovery of any waste heat is of value.

Under the Energy Efficiency Directive Industrial operators of combustion plants with a total thermal input exceeding 20MW and which are substantially refurbished must explore opportunities to recover waste heat for use in district heating schemes. IHRSP will extend to funding of those refurbishments.

Funding will be awarded on a competitive basis against "a set of established criteria"1, for example the potential heat recovered or carbon dioxide reduced.

To comply with State Aid rules support will be on a matched funding basis. The maximum level of match funding for feasibility studies will be 50% rising to 60/70% for SMEs. The maximum level of capital funding will be 30% rising to 40/50% for SMEs.

Projects that could have gone ahead without IHRSP support will not receive funding.

IHRSP will have rolling application windows for both Phases. A Phase 2 grant will not be provided to an applicant at the same time as a Phase 1 grant is awarded.

Draft detailed Guidance has been issued by BEIS.

Interaction with other support mechanisms

To the extent deployment of heat recovery technologies:

  • reduces EU ETS allowances and CCL through CCAs;
  • accesses support designed to incentivise deployment of CHP – e.g. ECAs, RHI and CfDs.

this will not prevent access to IHRSP support, but the aggregate value of support provided to an applicant across the various regimes will aggregate to the cap of Government support permitted by State Aid rules.

The value derived from other support mechanisms will also be considered in assessing the extent to which the project would have proceeded without IHRSP support.

There is explicit recognition of how IHRSP may interact with the £320 million Heat Networks Investment Project (HNIP) with the possibility of the IHRSP being used to fund enabling works and on site use/distribution and HNIP being used to fund construction or expansion of heat networks outside of a site boundary.


Although some respondents to the consultation suggested allocating funding away from Phase 1 to Phase 2 it may be that best value is extracted from Phase 1 as it will allow potential developers to rigorously assess:

  • heat sink issues/location for potential export;
  • temperature levels;
  • core business operational disturbance;
  • safety issues; and
  • process/technology reliability.

Conversely it is more difficult to see how the capital funding. (which is modest), will:

  • unlock the payback problem;
  • alter competition for capital within the business; or
  • solve the problem of focusing administrative effort on capex approval for non-core business.

Business may be more receptive where industrial waste heat recovery is funded and provided by third energy efficiency providers under a shared or guaranteed savings regime (perhaps as part of a wider energy efficiency offering).

Those organisations typically carry out a process that is naturally aligned to the IHRSP Phase 1 and Phase 2 stages. However it appears that IHRSP funding would not be available in this way to external commercial energy efficiency organisations. Although not expressly stated the applicant is assumed to be the entity carrying out the heat generating process. This is potentially a missed opportunity when the only relevant outcome is reducing energy use and Co2 emissions.


[1] Industrial Heat Recovery Support Programme, BEIS October 2017 paragraph 53.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Topics
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions