Families to earn £1,000 a year for going green

Published on Monday 1 February 2010 21:54

HOUSEHOLDS could soon be making around £1,000 a year by installing wind turbines or solar panels on their homes, under a new scheme.

Households and communities will be paid cash rewards to invest in small-scale green energy devices, such as turbines, hydro schemes and solar panels.

From 1 April, households that use gadgets up to five megawatts in size the equivalent of two full-sized wind-farm turbines will be eligible for the cash.

Under the government-backed scheme, any household or community that installs a green energy device will generate money in three ways:

A flat rate will be paid directly by their energy suppliers.

Surplus electricity can be sold into the national grid.

Savings will be made from reduced energy bills.

However, the scheme is expected to add up to 11 every year to the average household's energy bills by 2020.

The rate of return to households under the government's scheme, which is called "feed-in tariffs", is expected to be between 5 and 8 per cent annually.

Green energy groups pointed out this meant there was more money to be made from investing in renewables than from putting savings in a bank account.

The government hopes it will lead to a revolution in the uptake of small-scale renewables, with one in ten households across the UK generating its own green electricity by the end of the decade. Small-scale generation could meet 2 per cent of the UK's electricity needs by 2020, say officials.

And it is likely to provide a boost for the micro-turbine industry, in which Scotland is a world leader. There are large-scale manufacturers of micro-turbines in Glasgow and East Kilbride.

The government said installing a typical 2.5-kilowatt solar panel could earn a household up to 900 a year, as well as saving 140 on energy bills. For larger turbines, such as those installed by farms or outside rural homes, there would be the potential to make thousands of pounds each year.

Another area which will be covered by the incentive scheme will be anaerobic digestion (AD), the process where boidegradable waste, such as food, garden waste, card and paper are composted in the absence of oxygen, producing a biogas that can be used to generate electricity and heat.

Energy and Climate Change Secretary Ed Miliband said: "The guarantee of getting an income on top of saving on energy bills will be an incentive to householders and communities wanting to make the move to low-carbon living. The feed-in tariff will change the way householders and communities think about their future energy needs, making the payback for investment far shorter than in the past."

He said the government hoped to see 700,000 solar "photovoltaic" cells likely to be the most popular form of micro-renewable technology installed by the end of the decade, as the tariffs boosted uptake by customers.

Daniel Borisewitz, policy manager at Scottish Renewables, welcomed the move. He said the new scheme would be a "huge driver in encouraging additional uptake of small-scale renewable electricity generation throughout Scotland".

Alex Murley, British Wind Energy Association's head of small systems, said it was a "historic day for UK citizens, the UK energy sector and anyone interested in reducing their energy bills".

However, green groups Friends of the Earth and Greenpeace said the government's scheme was not ambitious enough.

A similar scheme from April 2011 will provide incentives for low-carbon heating.

Known as renewable heat incentive, it will the first of its kind in the world.

BENEFITS OF PLUGGING INTO THE ECO REVOLUTION

Two-kilowatt solar panel The sort that can be put on the roof of a house. With 50 per cent of the electricity used for the home and 50 per cent sold to the grid.

Cost to install 8,000

Annual earnings (taking into account maintenance costs and reduced energy bills) 1,040

Payback period 7.5 years

Small 1.5-kilowatt wind turbine The sort that can be put on a roof. At a location with a moderate windspeed, with 50 per cent of the electricity used for the home and 50 per cent sold into the grid

Cost to install 2,000

Annual earnings (taking into account reduced energy bills) 450

Payback period 4.5 years

Small six-kilowatt wind turbine The sort that could be installed outside a home. At a location with a moderate windspeed, with 50 per cent of the electricity used for the home and 50 per cent sold into the grid

Cost to install 22,000

Annual earnings (taking into account maintenance costs and reduced energy bills) 3,420

Payback period 6.5 years

Small 11-kilowatt wind turbine The sort a large rural home or farm may install. At a location with a moderate windspeed, with 50 per cent of the electricity used for the business and 50 per cent sold to the grid

Cost to install 44,000

Annual earnings (taking into account maintenance costs and reduced energy bills) 10,026

Payback period 4.5 years