Industrial Heating Oil (IHO) and Kerosene Financial Support Scheme & Rebated Fuel Entitlement

Financial support scheme launched for heating oil users

A Non-Domestic Alternative Fuel Payment Portal is being launched to support off-grid businesses with their heating costs.

Non-domestic properties that consume over 10,000 litres of heating oil are now entitled to extra payments which will be tiered according to usage up to £5,800.

Bespoke arrangements can also be made for high volume users that consume over 150,000 litres every year.

Non-domestic properties include:

• farms, warehouses, pubs and hotels run by businesses or individuals
• those run by voluntary sector organisations, such as charities
• places of worship and community halls
• public buildings, such as schools, hospitals and prisons

Are there any cases where users would not be covered under the scheme?

Whilst fuel used for space heating and industrial processes is covered by the scheme, organisations that use the fuel for the following purposes are not eligible:

• generating electricity which is then returned to the grid
• transportation
• selling to end-users in another location

You should also be aware that red diesel (gas oil) is not covered under this scheme.

How can I apply for the IHO and Kerosene Financial Support Scheme?

If you’re a business with a non-domestic property that’s connected to the grid, you will receive an automatic £150 payment through your energy supplier.

For off-grid businesses that won’t automatically receive the financial support, you can apply for a fixed alternative fuel payment or £150 through the portal.

You can apply for the fixed £150 payment if:

• the property is not connected to the gas grid
• the property is not connected to the electricity grid
• you purchased alternative fuels for use at the property between September 2022 and January 2023

To apply for the top-up payment, you must provide:

• proof of address
• company registration details
• proof of purchase (receipts over a 12-month period, starting 1^st September 2021 for the top-up or for the £150 fixed payment, one invoice that proves your purchase of alternative fuels for use at the property dated between September 2022 to January 2023)
• bank account details

The portal closes on Friday 28th April so we urge your business to apply as soon as possible

Update to rebated heating oil entitlement

In April 2022, new duty rules were introduced which resulted in many businesses losing their entitlement to use rebated diesel and biofuels, including marked oils. However; there have since been a few small amendments to this initial legislation with new guidance issued relating to ‘generating heat’ for premises.

This means that using a system to provide warmth to a room or building, or using a boiler or other appliance to heat water or other substances for use in or on the premises is entitled to use fully rebated kerosene and Industrial Heating Oil (IHO) on any premises.