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Summary

  1. Renewable Heat Incentive Inquiry examining botched energy scheme
  2. Chris Poulton, director at RHI administrator Ofgem, answers inquiry questions
  3. Inquiry set up after public concern over scheme's huge projected overspend
  4. Retired Court of Appeal judge Sir Patrick Coghlin chairing inquiry at Stormont
  5. Public evidence sessions expected to last until well into 2018

Live Reporting

By Iain McDowell and Robin Sheeran

All times stated are UK

  1. That's all for this week...

    Mr Poulton's evidence to the inquiry comes to an end, bringing this week to a close.

    Inquiry chair Sir Patrick Coghlin suggests to barrister Mr Aiken that there could be some "celebratory days" between now and the inquiry's return.

    Stormont's Parliament Buildings

    That's a reference to Liverpool's Champions league final clash with Real Madrid on Saturday next week - Mr Aiken is a Liverpool fan and we're sure he'll be glad of a distraction from all things RHI.

    There are no inquiry sittings next week so join us when it returns on Tuesday 29 May.

  2. What happened today at the RHI Inquiry?

    BBC News NI

    Administrators paid to run the RHI scheme didn't flag potentially exploitative usage to officials at DETI, despite sharing such intelligence with civil servants running the similar initiative in Great Britain.

    The practice of gaming is the running of multiple smaller boilers, rather than one larger one to maximise subsidy - it's not against the scheme's rules but may breach the spirit of them.

    Burning wood pellets

    The inquiry heard that Ofgem had been telling officials responsible for the GB RHI scheme about incidences of potential gaming since the summer of 2013.

    But the same information was not sent to DETI, which was responsible for the Northern Ireland scheme.

  3. 'Minute-taking of meetings was poor'

    Minute-taking and recording of key discussions between Ofgem and DETI about the RHI scheme was "poor", admits Mr Poulton.

    He claimed earlier that Ofgem put forward cost controls for the scheme to DETI during the April 2014 meeting between the organisations in Belfast but a note by an official from the department makes no mention of the issue.

    Mr Poulton

    Mr Aiken quotes extensively from the note, which wasn't shared with Ofgem and therefore doesn't represent an agreed minute, and he says the issue of cost controls "doesn't seem to have registered" with the person who wrote it.

    The lack of minutes and notes of crucial meetings and decisions has been repeated ad-nauseam since the inquiry hearings started last November.

    Mr Poulton says his memory is that Ofgem was "bringing to the table" a way of adding cost controls to the RHI scheme "earlier" than the department thought could be done.

  4. 'Authorising payment of taxpayers' money a major responsibility'

    Inquiry panel member Dame Una O'Brien notes a reference by Mr Poulton to Ofgem's role in the Northern Ireland RHI scheme as "merely administrating" it.

    She says "there's nothing mere about administrating".

    Dame Una O'Brien

    "It's a major responsibility to handle the applications and to authorise the payment of taxpayers' money," she adds.

    Mr Poulton accepts that by "looking at it now I think that's an unhelpful wording".

  5. 'Arrangements for managing scheme felt informal'

    Mr Poulton says he left the April 2014 meeting with DETI believing the department was happy with the arrangements that were in place with Ofgem to run the RHI scheme.

    But he tells the inquiry he could've pushed harder for something more formal to be set up.

    "It still felt slightly informal," he adds, saying that if DETI had a board overseeing the scheme then Ofgem should've had a seat on it.

    A boardroom

    Mr Aiken makes the point that Ofgem itself had proposed establishing an administration board two years earlier to help keep an eye on the RHI scheme, scrutinising and controlling its operation, costs and uptake.

    That suggested board, which would've been made up of officials from Ofgem and DETI, was never set up, as the inquiry has heard before.

    Mr Poulton says he wasn't aware of that at the time and if he had been he'd have suggested it should've been considered again.

  6. 'We put forward cost control proposals to DETI'

    An Ofgem delegation, which included Mr Poulton, met DETI officials in Belfast in April and October 2014 to discuss the RHI scheme.

    The witness says he remembers Ofgem putting forward two cost control methods that would be "quick/cheap to implement" and wouldn't be time-consuming to put in place.

    Sterling cash

    The matter of what was or perhaps wasn't discussed, was a topic under the microscope during the evidence session of Mr Poulton's Ofgem colleague Gareth Johnlast week.

    Mr Poulton says that degression - a way of dividing up the available subsidy budget among an increasing number of applicants - would be easy to set up because it was already in place in the Great Britain RHI scheme, which Ofgem was also administrating.

  7. Time for lunch...

    The inquiry will return shortly after 14:00 for the afternoon session - join us again then.

  8. 'Where was Ofgem's help in making RHI value for money?''

    Ofgem does not appears to have had a "shared interest in the value for money" of the RHI scheme, according to Dr MacLean.

    He's scathing with his criticism, saying the administrator took a "black and white interpretation" of the regulations of the RHI scheme rather than helping DETI to close loopholes.

    "Where is the thought... in helping DETI to ensure there is value for money?"

    Dr Keith MacLean

    The inquiry panel member says that Ofgem was withholding the key information that left DETI "completely exposed".

    "I agree that there is information that should have been shared that would have highlighted it, " says Mr Poulton.

  9. 'Does gaming disappear as you cross the channel?'

    There was confusion at DETI about which biomass boiler set-ups would qualify for the RHI scheme because civil servants didn't know how the term "heating system" in the regulations was being interpreted by Ofgem when it was processing applications.

    In December 2014 - two years after the scheme had opened - DETI passed to Ofgem a query from a potential applicant asking whether it would be possible to heat a large building with five small boilers that could collect a the maximum subsidy rather than two large units that would receive a lower fee.

    Ofgem official Nadia Carpenter advised that the boilers would be considered "separate plants" even though they were heating the same space and she suggested that DETI might want to amend the rules to tighten them.

    Sir Patrick Coghlin

    Sir Patrick says there's "a massive omission" in Ms Carpenter's email.

    "Where is the reference to the fact that this can amount to a risk of gaming? Does the risk of gaming disappear as you cross the channel?" he says.

    "I appreciate the word 'gaming' isn't being used," Mr Poulton says, but he adds that the email is "very clear" in pointing out to DETI a shortcoming in the regulations and that action could be taken to address it.

  10. 'Boiler inspections weren't focused on spotting gaming'

    Ofgem was asked by the Westminster PAC about how "reactive" it had been in "making the necessary changes" to prevent gaming in the Norther Ireland RHI scheme.

    Ofgem's Dr Nolan said that "we did try and monitor things as carefully as we could throughout and inform" DETI.

    A magnifying glass

    Assessing that now, inquiry panellist Dr Keith MacLean says there's no evidence that Ofgem was looking out for instances of gaming in the NI scheme because it "wasn't against the regulations".

    Mr Poulton accepts that the audits of RHI scheme installations in the NI scheme were not focused on picking up gaming.

  11. 'Important to gather scheme intelligence and amend regulations'

    The NAO report found that the GB RHI scheme did not represent value for money.

    Mr Poulton subsequently appeared before the House of Commons Public Accounts Committee with Ofgem's chief executive Dr Dermot Nolan.

    The Houses of Parliament

    The committee published its report this week and found that the GB scheme failed to meet its objectives or provide value for money, describing uptake forecasts as "wildly over-optimistic".

    During the questioning from the PAC, Ofgem was asked about the lessons learned from the Northern Ireland RHI scheme.

    One point Ofgem made was that it was important to "keep track" of the scheme, "gather as much intelligence and experience as we can" and amend the regulations as problems are spotted.

  12. 'Department has to work out how to fix problem'

    Sterling banknotes

    Mr Aiken asks whether Ofgem should have been on to DETI at a senior level when a "question mark" arose over "whether taxpayers' money was going out the door in the way that was intended" through the RHI scheme.

    The witness says the information should've be given to DETI but he's makes the point that it's not Ofgem's role to "be very forceful" in telling the department what it should do to fix the problem with the scheme.

    He says: "The department... has to... work out what they want to do - do you want to change legislation or accept the risk?"

  13. 'DETI not included in anti-fraud presentation'

    In May 2014 Ofgem's head of RHI operations Gareth John (below), who appeared before the inquiry last week, gave a presentation to the organisation's fraud management group.

    In the presentation he identified the risk of participants gaming the scheme and offered the mitigation: "Engage with DECC to modify legislation or accept risk".

    Gareth John

    "There's an 'and DETI' missing," observes Mr Aiken.

    Mr Poulton doesn't think he was at the event but says he doesn't see why the document didn't refer to DETI.

    "If its relevant to both schemes I don't see a reason why it shouldn't have been discussed with both," he says.

  14. 'DECC first told of RHI scheme gaming in 2013'

    A biomass boiler

    Ofgem first told DECC of instances in which the GB RHI scheme was being gamed in the summer of 2013.

    Sir Patrick appears surprised to learn that, asking: "In 2013 Ofgem is reporting activity, which is not against the regulations but is exploitative, as gaming?"

    "Yes," confirms inquiry barrister Mr Aiken.

  15. 'Concerns shouldn't have prevented flagging of gaming'

    Ofgem should've been "quite actively" trying to find ways of sharing crucial information about the RHI scheme, according to Sir Patrick.

    He says that "data-sharing difficulties" shouldn't have prevented the administrator from telling DETI about instances in which it had noticed the scheme was being gamed.

    "It wouldn't do; it shouldn't do," agrees Mr Poulton.

    A finger pointing at numbers on a screen

    Ofgem's audit strategy, which included the recognition of gaming and considered ways to deal with it, was not provided to DETI until July 2015.

    It had been shared with DECC and Mr Poulton says he doesn't "see a good reason why that information wasn't provided" to the Stormont department running the NI RHI scheme.

  16. 'Difficult to understand why DETI wasn't told about gaming'

    Unsatisfied with Mr Poulton's original answer as to why Ofgem didn't flag up gaming of the RHI scheme to DETI in the way it did to DECC, Sir Patrick pushes him harder.

    The witness says it's "difficult for me to answer".

    The RHI Inquiry

    But the inquiry chair hits back, telling him: "It's difficult for anyone to understand."

    Mr Poulton accepts Sir Patrick's firmly-put point.

  17. 'More could've been done to flag up gaming'

    The NAO report on the GB RHI scheme says that Ofgem was relied on to "flag up instances of gaming" to the Department of Energy and Climate Change, which was running the initiative.

    Mr Aiken puts it to the witness that the same should applied in the relationship between Ofgem and DETI.

    Wood pellets

    Mr Poulton says that's correct and he believes there's "a role for Ofgem to play" in pointing out gaming.

    But he says he doesn't think that his organisation operated the same system as it did with DECC in relation to flagging up gaming.

    Pressed by Sir Patrick to explain why DETI wasn't treated in the same way as DECC, the witness accepts that "more could've been done".

  18. 'Gaming not unique to NI's RHI scheme'

    In February this year, the National Audit Office (NAO) published its report on the Great Britain RHI scheme and it touched on a familiar theme - the so-called gaming of the initiative.

    That's something the Northern Ireland scheme was also open to and was one of the key problems that led to the huge projected overspend and the initiative's eventual shutdown.

    Mr Aiken reads from a section of the report that explains the RHI regulations "are complex and provide opportunities for participants to game them".

    A biomass boiler

    "Gaming occurs where participants are generating and using heat eligibly according to the regulations, but in a way that does not meet the intentions of the scheme, such as by not being energy-efficient or environmentally friendly.

    "Instances of gaming, while not against the rules, reduce the value for money of the scheme."

    Gaming was clearly "not a problem that was unique to Northern Ireland", says Mr Aiken.

  19. 'Change of attitude over scheme data sharing'

    From the start of the co-operation between DETI and Ofgem on the RHI scheme, there had been friction between them over data sharing.

    DETI wanted to have the details of RHI scheme participants but the administrator was reluctant to do that, citing data protection rules.

    Chris Poulton

    Mr Aiken notes that there was a change in attitude at Ofgem after Mr Poulton joined it in January 2014 after he sent an internal email suggesting that DETI should be given the information.

    "I couldn't see any reason why we wouldn't share the information," Mr Poulton says.

  20. 'DETI somewhere between customer and partner'

    Sir Patrick Coghlin

    Mr Poulton says Ofgem viewed DETI as "somewhere between" a customer needing the RHI scheme to be administered for it and a partner in running the initiative.

    Inquiry chair Sir Patrick Coghlin notes that that "whatever that combined role" was to mean "in terms of obligation or duty", the arrangements between the two organisations were not legally binding.