STORMONT officials decided against suspending the botched RHI scheme just months before a huge spike in applications caused its budget to spiral out of control.
The option of suspending the scheme was raised at a senior team meeting in June 2015, the RHI inquiry yesterday heard.
It was suggested that a failure to carry out a review, which had been a condition of the scheme's launch, could provide a legal basis for suspension.
However, officials instead chose to work on tiering as a method of cost controls to cap lucrative subsidies which had incentivised RHI claimants to 'burn to earn'.
Delays in introducing the cost controls in autumn 2015 brought a spike in applications and pushed the multi-million-pound government scheme hugely over budget.
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The scheme was eventually closed to new applicants in early 2016.
The inquiry heard that Stormont officials received legal advice on making changes to the scheme.
It advised that any action would need legislation and a public consultation – but it did not say the scheme could not be suspended, nor that the only option available was the cost-control method of tiering.
Andrew McCormick was permanent secretary in the Department of Enterprise, Trade and Investment (Deti) when RHI issues emerged in summer 2015.
He told the inquiry yesterday he could not recall reading or asking to view the legal advice.
Mr McCormick said Deti's rationale for not having a consultation was that one had been carried out in 2013 that discussed cost controls generally.
But he accepted it was a "dubious point" as the consultation did not specifically mention tiering.
Asked whether Deti took legal advice before it made its decision, he admitted he did not know.
Inquiry chair Sir Patrick Coghlin described it as "such a bizarre situation... from every aspect", saying that a suspension would have "prevented the further waste of public money" and provided civil servants with time to develop cost controls.
Mr McCormick agreed, but he said Deti energy officials' view was that RHI was a good scheme.
He accepted that more questions should have been asked, describing it as a "collective failure".
"Clearly at some stage the team, those who were dealing with this in detail in the energy division, had come to the view that this was the most straighforward change to make," he said.
"I just don't understand exactly how that reasoning worked out.
"I can't disagree with the chairman's use of the word 'bizarre'."
