The meters will be used to underpin a green heating subsidy scheme which will see more than £4 billion invested by the Government by the end of the decade.
Householders, businesses and public buildings are to be offered cash incentives to install environmentally friendly technology under an initiative known as the Renewable Heat Incentive.
In return they will receive a grant based on the amount of heat which is produced from the alternative source.
Heat accounts for 47 per cent of Britain’s CO2 emissions and it is estimated this scheme could halve bills paid by householders and businesses.
Initially the meters will be fitted on larger buildings, while individual home owners’ grants will be calculated according to the quantity of heat which they will have been deemed to have generated from alternative sources.
Greg Barker, the minister responsible for the project said “Measuring how much heat you have saved is rather harder to measure on a domestic scale,”
The meters will be installed in individual houses as the renewable technology develops and it becomes easier to measure how much green heat is used by single households.
A variety of sources have been earmarked as potential sources of “sustainable’' heat.
They include solar thermal panels, which could be fitted to a roof and used to heat water. Homes could also install heat pumps, capable of drawing warmth from the ground or air outside the house. These pumps can also be reversed in the summer, to dissipate heat and cool a home.
Larger buildings including blocks of flats and housing developments old use biomass boilers. About the size of a large fridge, they generate heat by burning woodchips and pellets.
Biomethane could be produced to heat homes from a number of sources, including landfill sites, sewage treatment plants and animal slurry.
With oil prices soaring on the world markets, pressure is mounting on Britain to find alternative sources of energy.
The initiative by the Department for Energy and Climate Change is similar to that by the Department for Transport which is offering subsidies of up to £5,000 for anyone buying an electric plug-in car.
“People are becoming much more focused on the need to be more energy independent,” Mr Barker added.
Ultimately the Government hopes that the bulk of homes will be generating their heat from sustainable sources, enabling British businesses to generate technology which could be sold to other countries.
The initiative was welcomed by Gaynor Hartnell. chief executive of the Renewable Energy Association.
"Britain had been falling behind its targets and swift action has been needed to address this. It’s a novel approach being pioneered in the UK and hopefully we will be setting an example to other countries."
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