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Homeowners are to be offered extra financial incentives to fit their properties with solar panels and wind turbines in an ambitious green energy programme to reduce the nation’s dependence on fossil fuels.

At the heart of the £100 billion renewable energy strategy, due to be unveiled this week, is a proposal to encourage householders to generate their own power.

They will be able to sell back surplus electricity at premium prices to the national grid. At present it can be sold only at market rates.

Other proposals to ensure Britain hits its EU target of generating 15% of its energy from renewable sources by 2020 are the building of 3,500 onshore wind turbines. About 2,000 are currently operational. John Hutton, the energy secretary, announced plans to build 7,000 offshore wind turbines last year.

Large areas of the countryside could also be planted with woodland and crops to be burnt in a network of smaller power stations. It is estimated the renewable revolution detailed in the consultation document could create 160,000 jobs and cost £100 billion over 12 years.

Gordon Brown hopes oil-producing countries may invest in greener energy schemes in Britain. As he headed to Jeddah for a summit on oil prices, the prime minister said it was in the interests of the oil-producing nations to fund more environmentally friendly energy sources.

Leonie Greene, spokeswoman for the Renewable Energy Association, said: “We can hit the target, but there needs to be action and urgency. The political impetus on renewable energy is coming from Europe and we’re playing catchup.”

The government’s new strategy will fail unless homeowners install alternative energy sources and fit proper insulation. Ministers envisage up to 7m solar heating systems by 2020, compared with 90,000 now.

While installing domestic solar panels can cost between £5,000 and £10,000, the government has been accused of failing to provide big enough grants. Environmental groups also complain about the lack of campaigns to persuade households to go green.

According to the strategy document, there could be a 90% increase in the use of ground source heat pumps, which heat homes by harnessing the warmth in the earth. Homeowners will also be encouraged to install wind turbines.

A generous package of grants and financial incentives will be needed to persuade householders to insulate their homes and use sustainable energy sources. Ministers will also look at the German system in which homeowners can sell surplus electricity to the grid at premium rates.

To date, most Britons who have converted their homes to green power have been motivated by concern for the environment. Some schemes can take more than 20 years to recoup the investment.

Donnachadh McCarthy, who lives in London and is author of Saving the Planet without Costing the Earth, said: “I’ve installed solar electric, solar-heated water, a wind turbine, a water harvester and a woodburner. It’s cost around £22,000.

“I got £400 in grants, so Gordon Brown has made a huge profit out of me. Having spent so much, I’ve a lot of catching-up to do. The woodburner is by far the best thing. I use waste wood from my local area, so it is completely carbon neutral.”

The government may also have to ease planning restrictions. When David Cameron, the Tory leader, first installed a wind turbine at his London home it had to be removed because it breached planning rules.

Perhaps the most controversial part of the government’s plans is the building of 10,500 wind turbines. Of those, 3,500 are onshore and are likely to face strong opposition.

Among proposals that have already been scrapped is a plan for a 27-turbine wind farm in the Lake District. Kyle Blue, who campaigned against the scheme, said: “The countryside round here was far too special to be ruined by wind turbines.”

The difficulty of hitting the 15% renewable target is illustrated by the fact the government wants to include the Severn Barrage – a tidal power station across the Severn estuary – in the official renewable figures for 2015. The scheme will not be completed until well after 2020.

The strategy says nearly 6% of electricity could be generated by bio-energy – the burning of wood and plants to generate electricity. It suggests nearly 880,000 acres could be turned over to bio-energy crops.

There are, however, concerns about the impact of a large increase in the use of bio-fuels on the environment and on food prices.

One of the dividends of a green energy revolution would be a reduction of more than 5% in oil use by 2020. It would also significantly reduce the UK’s carbon emissions.

The government’s renewable energy strategy was welcomed yesterday by environmental campaigners. John Sauven, executive director of Greenpeace, said: “If this plan becomes a reality, Britain will be a better, safer and more prosperous country.

“We’ll create jobs, reduce our dependence on foreign oil and use less gas, and in the long run our power bills will come down.”

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