The art of coppicing will be revived in woodlands across Britain under a Government plan to subsidise the installation of thousands of wood-fuelled boilers.
Businesses and homeowners will be paid a total of £860 million of public money over the next four years under the Renewable Heat Incentive, which will subsidise heating systems that do not require fossil fuels.
Chris Huhne, the Energy Secretary, said Britain was only burning a tenth of the wood that could sustainably be used as fuel.
“There are an awful lot of forests we have which are not being harvested. [We] can see a very sustainable supply chain of coppicing feeding wood chip boilers.”
The Department of Energy and Climate Change said coppicing would also improve biodiversity in woodlands.
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About 80 per cent of the subsidy will be paid to commercial users, community projects and public sector organisations. Homeowners will receive fixed grants from July worth about 10 per cent of the cost of installing renewable heating systems, such as biomass boilers, solar thermal tubes, and ground and air source heat pumps.
However, homeowners will have to wait until October 2012 to be paid for each unit of heat they generate.
The rate they receive will be reduced under regular reviews which will take account of the anticipated decline in the cost of installing renewable heating systems.
Mr Huhne said the subsidy, the first of its kind in the world, was a key part of the Government’s vision for a low-carbon future for the UK.
“Heat is responsible for a little less than half of our carbon emissions. This is a scheme designed to provide support to all of the technologies that can replace carbon technologies.
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“It’s a very significant scheme indeed, for the whole process of being a pioneer green economy, and it’s a key part of the Government’s commitment to being the greenest government ever.”
Mr Huhne said a small hotel or B&B which installed a biomass boiler that cost around £50,000 could expect to receive subsidies worth £11,600 a year.
The Renewable Heat Incentive is expected to reduce emissions by 44 million tonnes over the next decade, the equivalent of taking two gas-fired power stations off the grid.
Alan Simpson, Friends of the Earth sustainable energy adviser, said the subsidy could have negative impacts by encouraging imports of wood from poorly managed forests.
“There are serious concerns about the surge in the use of unsustainable biomass and incineration these proposals could encourage — the scheme must only promote genuinely green and sustainable sources of heat.”
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British Gas said the scheme would allow it to proceed with a plan to install a wood chip boiler that would provide around half the heat for 1,200 homes on the Heath Town estate in Wolverhampton.
Which? chief executive Peter Vicary-Smith said that, with energy prices such a concern for consumers, households would be eager to take advantage of the subsidy.
“However, it’s vital that people are sold the right renewable heating system to suit their home,” he said.
“If horror stories start to emerge of people spending thousands of pounds on equipment that’s either unsuitable or isn’t installed properly, then confidence in the scheme will be severely undermined.
“We’ve already uncovered problems with mis-selling of solar thermal heating systems so it’s vital that the authorities keep a close eye on the market and come down hard on rogue firms.”