Homeowners and businesses will be rewarded for using heat from green sources in a government scheme believed to be the first financial incentive of its kind.
Energy secretary Chris Huhne launched the £860 million Renewable Heat Incentive (RHI) which will aim to reduce the country’s dependence on fossil fuel heating and emissions.
Currently around half of the country’s carbon emissions come from the energy used to produce heat, which is more than from generating electricity.
It is hoped that the scheme will reduce emissions by around five per cent (44 million tonnes of carbon) by 2020.
Mr Huhne said: “Renewable heat is a largely untapped resource and an important new green industry of the future.
“This incentive is the first of its kind in the world. It’ll help the UK shift away from fossil fuel, reducing carbon emissions and encouraging innovation, jobs and growth in new advanced technologies.”
Over 95 per cent of heat in the country is currently produced by burning fossil fuel, but there is now an emphasis on turning to low carbon alternatives because of dwindling North Sea supplies.
Homes will start receiving payments for using equipment like solar thermal panels, renewable heat pumps and boilers burning biomass such as wood chips in October 2012.
From July this year homeowners who install green heating systems before the scheme starts will also get a one-off payment depending on the type of renewable technology they put in.
Further details of the scheme can be found at: www.decc.gov.uk/rhi