Further contact from the so-called whistleblower Mrs O'Hagan in May 2014 "chimed with me" more than the initial issues she had raised about the RHI scheme, says Mr Hutchinson.

She emailed him to reiterate the concerns she'd expressed at the meeting with DETI the previous October.

Image source, Getty Images

In the email, she said "there is no incentive at all to be efficient" and the "heat in buildings is on all year round with windows open everywhere".

"When we had spoken you did not believe this, but please believe me, this is happening with almost everyone we approach," she added.

Mr Hutchinson says that some of the evidence the inquiry has shown to him yesterday and today would be "alarm bells" and would cause him to think to himself: "Why didn't you pick this up far sooner?"

Another of those is a Smart Eco Hub event near Newry in March 2014, which he attended and gave a talk at, along with installers of renewable heating systems.

He sat through a presentation by one installer - Conall McMullan of Alternative Heat - who outlined how the RHI scheme provided a "massive rate of return on the investment" and a "guarantee of a 20-year income".

The "major returns" made it a "safe bet", added Mr McMullan.

Mr Hutchinson says that was one "trigger" for him to look again at the payments on offer through the scheme and notice that there were issues to be addressed.

Mr Hutchinson left DETI in May 2014, and in his handover note to his successor Davina McCay he listed a series of "immediate actions" required by the end of August that year.

They included a review of non-domestic biomass tariffs for installations under 100kW on the RHI scheme and the consideration of tiered tariffs to prevent excessive payments.

Image source, Getty Images

He explained that it had become apparent that payments were higher than those envisaged by consultants at Cambridge Economic Policy Associates, who had been engaged to draw up the scheme and calculated the tariffs.

The administrator Ofgem had advised that boilers were being used for much longer periods than expected and as a result the tariffs could become overgenerous.

Ms McCay was told that the issue should be considered "as a matter of urgency".

Mr Lunny puts it to the witness that DETI's main reason for being sceptical that people might behave as Ms O'Hagan had suggested was that the officials may have thought: "CEPA have designed this tariff - we think their design is robust".

Image source, RHI Inquiry

Mr Hutchinson says that if someone had said to him in 2013: "'How do you stop people wasting heat?' I think my stock answer would always have been; 'CEPA looked at that and it's not happening.

"'It doesn't mean it won't happen in the future and we'll continue to look at it.'"

When Mrs O'Hagan was described as a "whistleblower" in the media when the scandal of the RHI scheme emerged in December 2016, Mr Hutchinson says he was "confused".

In his written statement to the inquiry, he says he wouldn't have applied that label to her.

Image source, Getty Images

"She was an interested stakeholder - very helpful, very interesting very informative," he tells the inquiry.

He adds that the concerns Mrs O'Hagan raised are "a lot more clear now" than there were at the time of her meeting with him and other DETI officials.

"I'm not sure there was that clarity at that point - not in my mind at least."

Mrs O'Hagan became aware of the RHI scheme when she was trying to market her energy efficiency product in late-2012 and early-2013.

She noticed that her target market had no interest in her product because most were claiming from the scheme, and it appeared to her to disincentivise efficient use of heat.

Image source, Getty Images

Inquiry panellist Dr Keith MacLean asks whether the DETI officials who met her felt she had a "vested commercial interest in what she was saying" and were therefore cautious in taking what she said at face value.

Mr Hutchinson says: "I don't think you would've said: 'We're not listening to you because you're selling a product,' but he adds that other issues at the time suggested to the contrary of what she was telling them.

Mrs O'Hagan was invited to submit her concerns as part of the public consultation on the scheme that was running at the time - she declined to do that and Mr Hutchinson acknowledges that he could have gone back to her to seek more information.

A businesswoman tried to draw the then DETI minister Arlene Foster's attention to a major flaw in the RHI scheme in August 2013, and she was granted a meeting with Mr Hutchinson and other officials working directly on the initiative.

Janette O'Hagan (below), who's been described as a whistleblower, told them it was so lucrative she was surprised firms were not putting radiators on the outsides of their buildings.

Image source, RHI Inquiry

Her records show that she also told them that scheme claimants were "using more energy than before because it pays them to do so" and pointed out that there was "no incentive for them to be efficient".

Mrs O'Hagan said her claims were dismissed, with saying one official telling her: 'We don't think people will do that.'

Mr Hutchinson says he didn't use that phrase and he would've told Mrs O'Hagan that DETI believed measures were in place to prevent what she had been describing.

In 2013, a problem arose involving the eligibility for RHI scheme payments to installations that had received a loan form the Carbon Trust.

That was solved by restricting the amount of RHI subsidy that Carbon Trust loan recipients could receive.

It also led Mr Hutchinson to see examples of forms filled in by applicants including projected hours of use and payments.

Image source, RHI inquiry

Mr Lunny gives an example of a form for a 99kW boiler whose initial figure for hours of use is 8,640 per year, which equates to being run non-stop year round.

Mr Hutchinson confirms that what he saw in the forms caused him some concerns.

"Looking at it now it causes me even more concern than it did at the time; less so the focus on the hours - at the time it was the focus on the payment level," he says

At a DETI event about the RHI scheme that was held during the autumn 2013 consultation period, a question was raised about whether two 99kW boilers "separated hydraulically but under the same roof" would qualify as a single or separate units under the regulations.

DETI replied that "they might be seen as separate heating systems", and would therefore qualify for the higher subsidy on offer for smaller units.

Image source, RHI Inquiry

Inquiry chair Sir Patrick Coghlin says that Ofgem had warned the previous year that similar scenarios could arise.

Mr Hutchinson accepts that it would have been easy for the DETI officials to contact Ofgem, the scheme's adminstrator, to clarify what the answer would have been.

"I don't know why it hasn't been clarified if it's come up at that point," he adds.

DETI opened a public consultation in autumn 2013 on its planned update to the RHI scheme, and a number of concerns were raised by respondents.

One - Biomass Energy Northern Ireland (BENI) - had warned in the consultation before the scheme opened in 2012 about the potential for so-called gaming of the scheme.

Gaming is the installation of multiple small boilers instead of one large, more efficient boiler, in order to collect a higher subsidy on offer for the smaller systems.

In the 2013 consultation, BENI said that what it had warned about "is now very apparent on the ground", with a "plethora of multiple-but-separate systems" being used and a "demand to undersize boilers just to stay within the higher rate tariff".

Businessman Colin Turkington wrote to the Department of the Environment complaining that the RHI scheme was deterring farmers from adopting his company's poultry manure to energy (PM2E) system.

He identified a "perverse incentive" for farmers to install a number of small woodchip boilers rather than a larger PM2E system.

The letter was passed to DETI for reply and Mr Turkington's interpretation was rejected by the department.

The question revolves around the by-now-familiar concept of separate heating systems under a single roof.

Mr Hutchinson makes an admission: "Now, looking at it, he was right and we were wrong."

Stormont's Department of Agriculture and Rural Development (DARD) was being "high-pressure salesmen" for the RHI scheme even though it knew how profitable it was, says inquiry chair Sir Patrick Coghlin.

He says DARD was "actively pressure-selling this scheme" and wants to know why the department did not contact DETI to draw its attention to the overgenerosity of the initiative.

"Was there no communication between departments in this government? It just seems to be a totally disjointed system," he adds, questioning why that attitude was taken to the spending of public money.

Image source, RHI Inquiry

Mr Hutchinson says officials from other departments might say that they had a "legitimate expectation that [DETI] had got our sums right in the first place".

"Maybe they just thought: 'Well, that's a DETI scheme and they're running it how they think and we're not going to point anything we think is a mistake with it.'"

Mr Hutchinson says that communication between departments has improved, and Sir Patrick responds: "That's comforting!"

Cafre produced a booklet in October 2013, to which both Mr Ellis and Mr Hutchinson contributed articles.

Mr Ellis's section outlines a case study of a poultry farm in Moygashel in County Tyrone with 12 sheds.

It suggests a set-up of 12 individual small biomass boilers through the RHI scheme, rather than one or two large boilers to do the same job.

Doing so enabled the claimant to garner the maximum tariff on offer through the scheme of 6.1p per kWh, because higher subsidy was on offer for smaller boilers.

Image source, Getty Images

Mr Hutchinson's section appears some 16 pages later and is, Mr Lunny explains, a fairly straightforward explanation of the mechanics of the scheme.

A final section of the leaflet, not written by Mr Hutchinson, is more of direct rallying cry to potential participants, saying: "It's payback for renewable energy investments."

Had Mr Hutchinson seen the piece on the case study, it would have "sparked a question in my mind", he says.

The College of Agriculture, Food and Rural Enterprise (Cafre) ran a number of events at which the RHI scheme was promoted.

Cafre official Cathal Ellis was heavily involved in the promotion of renewable energy at those events, and Mr Lunny introduces slides from a presentation he gave on 17 occasions.

It suggests a figure of 4.2p per kWh based on a wood pellets costing £200 a tonne, although Mr Lunny notes that pellets could be bought in bulk as cheaply as £160 a ton.

Importantly, Mr Ellis's slides show that the fuel cost was cheaper than the subsidy on offer through the initiative.

Mr Hutchinson also attended those events and gave lectures at some of them, but says "I don't think I would have sat in on Cathal's at those points".

He says that the figures in Mr Ellis's presentation would have "struck a nerve" with him if he had seen them.

Sheridan & Hood and BS Holdings - firms that supplied and installed renewable heating systems, including biomass boilers - were perhaps the first firms to spot the generosity of the RHI scheme.

In order to generate sales, they produced promotional leaflets and booklets that outlined the potential rewards of joining the scheme.

Image source, Getty Images

One of them that Mr Lunny shows the inquiry details a scenario in which a scheme claimant would collect £1,475 in a year if they spent £1,000 on biomass fuel.

Mr Hutchinson says he can't specifically remember any of the material but he does recall meeting Mr Hood.

And they're off, as the inquiry's junior counsel Donal Lunny picks up were he left off yesterday afternoon.

Image source, RHI Inquiry

He had been asking Mr Hutchinson about his contacts with equipment installers and suppliers.

First up this morning, he takes the witness to some promotional material issued by Sheridan & Hood and BS Holdings, companies run by Brian Hood, who gave evidence to the committee earlier this month.

BBC News Northern Ireland

Former DETI official Peter Hutchinson told the inquiry he "feels a bit sick" when he hears terms like "cash for ash" or "burn to earn" in reference to the RHI scheme.

Image source, Pacemaker

He was one of the small group of civil servants involved in the scheme at the time of its inception and he spent the whole day as the sole witness.

The inquiry also heard that a dispute over data sharing between DETI and the initiative's administrator Ofgem meant that the department may have missed vital information about the use of multiple boilers by claimants.

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.

Image 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.

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 faced calls to resign from her role as Northern Ireland's first minister in December 2016.

Image source, PA

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, more than a 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.

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.

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

The massive overspend bill will have to be picked up by the Northern Ireland taxpayer.