The RHI for non-domestic systems, due to be launched on 30 September, has been delayed at the last minute after a European Commission dispute.

The Department of Energy & Climate Change (DECC) released a statement on 29 September - the day before the planned launch - revealing that the £860 million scheme to subsidise renewable heating systems was being "delayed" after the European Commission failed to approve the tariff for biomass systems.

DECC's statement said: "State aid approval is a necessary condition for the scheme to go ahead. As part of that process, the European Commission has expressed concerns that the large biomass tariff is set too high. We understand that the Commission has given state aid approval for the RHI, subject to a reduction in the large biomass tariff, and we expect to receive written confirmation of this very soon.

"Changing the large biomass tariff will require the RHI regulations to be amended and submitted to Parliament for approval. We are unable to launch the scheme as a whole until this process has been completed. Therefore, unfortunately, we will not be able to open the scheme for applications on 30 September 2011 as we had originally planned.

"Once we have received written confirmation from the Commission, we will make a further announcement about what this means for the large biomass tariff and the timing of the launch. We are committed to launching the scheme as soon as possible to minimise disruption to stakeholders."

The government has previously said the RHI would "revolutionise" the way heat is generated and used, and that it was the first financial support scheme for renewable heat in the world.

Paul Thompson, head of policy at the Renewable Energy Association, said: "The industry has been gearing up over the last six months to deliver on the government's ambitious plans for renewable heat. This further adds to low confidence levels in the renewables industry as a whole, added to uncertainty around the feed-in tariffs, the renewables obligation and the renewable transport fuel obligation."