Households which contribute electricity to the National Grid are to receive payments under a new government scheme. Communities will be encouraged to generate wind, water and solar power, and be paid for how much they produce. Energy and Climate Change Secretary Ed Miliband said the project would "help create the clean energy of the future".He denied reports the government's energy strategy would cost each UK family £230 a year but admitted there would be "upward pressures" on prices.
He said the "high-carbon route" would mean a greater dependence on imports and exposure to price fluctuations, while the alternative "low carbon future" - which he said was "the right way to go" - would mean "mean some costs to transition".He added: "Individuals and communities can both play their part in the kind of clean energy revolution that we need."
At present, anyone in the UK who feeds electricity into the National Grid can get a reduction on their fuel bills through smart meters.Similar "clean energy cash back" schemes already operate in 19 European countries including Germany.
Critics warn that small-scale production is expensive and projects may require government subsidy.In Germany, whole towns have grouped together to buy wind turbines, build biomass plants and erect solar panels.They are then paid a guaranteed fixed price for every kilowatt hour of energy they produce - a higher sum than for electricity made from fossil fuels in traditional power stations.Three wind turbines can make £15,000 a year for a single village.Since so-called "feed-in tariffs" were introduced in Germany, some 400,000 homes,particularly in the sunnier south of the country, have installed solar panels.But the government has had to subsidise such projects in order to keep them viable.At present, only about 2% of Britain's energy comes from renewable sources, but the government has pledged to increase that to 15% within the next 12 years.
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