Renewable heat generation plants linking workplaces and homes to improve energy efficiency are being given serious consideration by the Scottish Government.

John Swinney, the Cabinet Secretary responsible for energy, said yesterday it is becoming a major part of the future power strategy, while the first grid connection for tidal power near Orkney is to be confirmed soon.

Advice centres are to be opened to help home owners and small businesses go green, while the budget for micro-generation grants and loans are being boosted.

Mr Swinney claimed more energy is used for heating and hot water in Scotland than transport and electricity generation combined, at 57% of total energy demand. The Scottish Government is discussing with the European Commission how to boost the renewable heat sector.

"If we're to reduce carbon emissions, we have to target that as a particular priority," Mr Swinney told the Scottish Renewables industry conference in Edinburgh. "We have an opportunity to lead the UK in building a commercially viable, diverse renewable heat industry. That proposition will lie at the heart of the government's approach."

He was commenting as First Minister Alex Salmond visited Lockerbie for the formal opening of the UK's biggest wood-fired power station. The Steven's Croft biomass plant will produce enough power to supply up to 70,000 homes.

The 44-megawatt E.ON UK station burns forestry left-overs and specially-grown willow, saving up to 140,000 tonnes of greenhouse gases each year. It has 40 jobs on site, with 300 more in neighbouring farms, diversifying into willow growth.

Alex Salmond said the station marked a step towards Scottish Government targets of 50% of electricity from renewables, and an 80% cut in carbon emissions by 2050.

"It is proof that not only can we generate power from materials previously seen as waste - we can create good-quality jobs and improve the sustainable management of our forests," the First Minister said.

In Mr Swinney's speech, he announced extra cash for grants, loans and advice for small-scale green energy devices on homes and businesses. Householders will be able to claim grants of up to £4000, and local groups up to £100,000 for turbines, solar panels or heat pumps.

The £13.5m commitment is three times the amount in recent years. Its focus for small businesses is to go beyond the recent emphasis on energy efficiency and help boost their small-scale generation.

Mr Swinney told industry representatives he is soon to set out measures to speed the planning and energy consents process, following persistent business criticism of long delays in getting decisions.

He said Mr Salmond is soon to meet the energy regulator and John Hutton, Whitehall's Energy Secretary, to push for simpler and cheaper access to the grid for remote renewables projects.

A leading figure in the European renewables industry told the conference that Scottish planning applications can take two to three times longer than in other countries.

Alistair Jamieson, chairman of Renewables Scotland, said Scotland leads much of Europe in renewables but its targets will force a much faster pace.

"The journey to a low or zero carbon economy by the middle of the century must start now, but Scotland is still packing the suitcase," he said.