Summary

  • Design of botched scheme outlined to Renewable Heat Incentive Inquiry

  • Stormont EU expert Stephen Moore answers inquiry questions

  • Inquiry set up after public concern over scheme's huge projected overspend

  • Retired Court of Appeal judge Sir Patrick Coghlin chairing inquiry at Stormont

  • Public evidence sessions expected to last until well into 2018

  1. 'Scheme design teams must be aware of aid rules'published at 11:16 Greenwich Mean Time 1 February 2018

    Teams designing initiatives like the RHI scheme "need to be aware" that it is likely to fall under EU state aid rules and must fit within them, says Mr Moore.

    Sterling cashImage source, Getty Images

    He goes on: "We found it very difficult if people [setting up schemes] came to us late with something and then we turn round and say: 'Sorry, this doesn't fit the state aid rules.'"

    He makes the point that sometimes the schemes that he is asked to advise on can be more generous than the aid rules allow.

  2. 'EU rules barred overcompensation'published at 11:00 Greenwich Mean Time 1 February 2018

    Mr Lunny reads from what he and Mr Moore agree is "the key provision" regarding the operating aid provisions as they apply to the RHI scheme.

    That allows scheme participants "a normal return on capital".

    Donal LunnyImage source, RHI Inquiry

    Mr Lunny explains this is the source of a requirement in the EU's RHI scheme state aid approval of "an absence of overcompensation".

    And as it turned out, overcompensation was to be the source of all the RHI's ills.

  3. 'Sole focus was on subsidy scheme rules'published at 10:52 Greenwich Mean Time 1 February 2018

    There were two options for the RHI scheme - one was an up-front grants offer for claimants to buy a new renewable heating system; the other was an ongoing subsidy for operating their system over 20 years.

    The latter was chosen, even though it was projected to cost hundreds of millions of pounds more over its lifetime.

    Burning wood pellets

    There are differing state aid rules covering the two models - a competitively-bid-for grants scheme is covered by investment aid rules; a subsidy scheme is covered by operating aid rules.

    Inquiry counsel Donal Lunny asks if Mr Moore was ever consulted by DETI's RHI staff about the terms for the better-value grants option they later rejected.

    Mr Moore says he was "never aware" of the grants fund option, was never asked about EU rules for it, and DETI's sole focus was on the rules on the subsidy model.

  4. 'My role to help DETI comply with EU rules'published at 10:23 Greenwich Mean Time 1 February 2018

    It was the responsibility of DETI's energy team to make sure the RHI scheme complied with EU state aid rules, says Mr Moore.

    Men talking in an officeImage source, Getty Images

    He tells the inquiry that it is simply his role "to help them do so".

    He reads cases and applications from the point of view of someone from the European Commission, checking to see that they are clear and address all of the issues covered by guidelines on state aid.

  5. 'EU State aid rules absolutely complicated'published at 10:22 Greenwich Mean Time 1 February 2018

    Inquiry chair Sir Patrick Coghlin, who's a retired judge, is intrigued to hear Mr Moore say he gave advice on the EU state aid rules and procedures "but not on a legal basis".

    State aid is a subdivision of European competition law, says Sir Patrick, adding: "I don't think it's doing it any disservice to say it's fairly complicated."

    Sir Patrick CoghlinImage source, RHI Inquiry

    "It is absolutely complicated, yes" says Mr Moore, who trained as a mechanical engineer.

    If there was any doubt about legal aspects he would refer them to government lawyers.

  6. 'Short-staffing a constant, ongoing theme'published at 10:08 Greenwich Mean Time 1 February 2018

    Mr Moore's role in the RHI scheme was to advise and assist DETI's energy team that was setting up the initiative on how it should comply with regulations on state aid for the renewable energy sector.

    He describes his involvement as one of a "light touch".

    Stephen MooreImage source, RHI Inquiry

    At the time, DETI's state aid section was made up solely of Mr Moore and he says that was inadequate for the workload.

    Short-staffing in the state aid branch was a "constant, ongoing theme" and it "took a while" for the department to "realise that was the case", when it then doubled the one-man team.

    Mr Moore and his state aid colleague have a fair bit on their hands now as they handle Brexit issues for the department.

  7. New witness Stephen Moore gives evidencepublished at 10:03 Greenwich Mean Time 1 February 2018

    Stepping up this morning is Stephen Moore, who works for the Department for the Economy - formerly DETI - as an expert on EU state aid.

    Stephen Moore taking the oathImage source, RHI Inquiry

    After taking the oath, he confirms that he's submitted more than an thousand pages of documentation to the inquiry.

    You'll find Mr Moore's written statement to the inquiry here, external.

  8. What happened yesterday at the RHI Inquiry?published at 09:57 Greenwich Mean Time 1 February 2018

    BBC News Northern Ireland

    Civil servants were "furious" when they discovered the development costs for the RHI scheme looked set to double, the inquiry was told.

    Sterling banknotesImage source, Getty Images

    Fiona Hepper, the energy boss at DETI, demanded that costs be cut.

    In response the administration team "sharpened up" the estimates, cutting them by several hundred thousand pounds.

  9. What is the RHI Inquiry?published at 09:53 Greenwich Mean Time 1 February 2018

    BBC News Northern Ireland

    An independent inquiry into the RHI scandal was established in January last year by the then finance minister Máirtín Ó Muilleoir.

    He ordered it in the wake of the huge public concern and what was then a developing political crisis surrounding the scheme.

    The RHI Inquiry began in November and Sir Patrick Coghlin (below), a retired Court of Appeal judge, is its chair and has been given full control over how it will operate.

    Sir Patrick CoghlinImage source, Pacemaker

    It will look at:

    • the design and introduction of the RHI scheme
    • the scheme's initial operation, administration, promotion and supervision
    • the introduction of revised subsidies and a usage cap for new scheme claimants in 2015
    • the scheme's closure

    For more information on the RHI Inquiry, you can read our handy Q&A.

  10. RHI scheme - the falloutpublished at 09:50 Greenwich Mean Time 1 February 2018

    When the scale of the overspend emerged, public and political concern rocketed.

    As the minister in charge of the Stormont department that set up the RHI scheme, the Democratic Unionist Party (DUP) leader Arlene Foster (below) faced calls to resign from her role as Northern Ireland's first minister in December 2016.

    Arlene FosterImage source, AFP

    She resisted, and Sinn Féin's Martin McGuinness then quit as deputy first minister in protest at the DUP's handling of what had by then become a full-blown political crisis.

    That move brought about the collapse of the Northern Ireland Executive. Now, a full year on from that, Northern Ireland remains without a devolved administration.

    You can find much more detail on the RHI scheme in our need-to-know guide.

  11. RHI scheme - the flawspublished at 09:49 Greenwich Mean Time 1 February 2018

    The budget of the RHI scheme ran out of control because of critical flaws in the way it was set up.

    Claimants could effectively earn more money the more fuel they burned because the subsidies on offer for renewable fuels were far greater than the cost of the fuels themselves.

    Wood pellets

    The most recent estimate for the overspend was set at £700m, if permanent cost controls aren't introduced.

    The massive overspend bill - whatever it turns out to be - will have to be picked up by the Northern Ireland taxpayer.

  12. RHI scheme - what was it?published at 09:47 Greenwich Mean Time 1 February 2018

    The Renewable Heat Incentive scheme - or RHI for short - came to the fore of the Northern Ireland public's knowledge in autumn last year... and the fallout from the scandal attached to it is still being felt in the region's politics today.

    Burning wood pellets

    The scheme was set up by the Northern Ireland Executive in 2012, as a way of encouraging businesses to switch from using fossil fuels to renewable sources for generating their heat.

    Those who signed up were offered financial incentives to buy new heating systems and the fuel to run them.

  13. Good morningpublished at 09:43 Greenwich Mean Time 1 February 2018

    It's a brisk, damp but bright morning on the hill at Stormont.

    Stormont's Parliament BuildingsImage source, AFP

    We'll be kicking off today's live coverage of the RHI Inquiry shortly with morning's witness Stephen Moore.

    He worked for the Department of Enterprise, Trade and Investment (DETI) in European support... so expect to hear plenty about EU state aid regulations!