New housing developments could be built with small scale plants which produce both electricity and heat to make them more energy efficient and cut their carbon output, engineering experts suggested today.

And new coal-fired power stations such as the one planned for Kingsnorth in Kent should have technology to capture waste heat which could be used to warm homes.

The Institution of Civil Engineers (ICE) said the demand for heat accounted for almost half (49%) of primary energy consumed in the UK.

But coal and nuclear plants are only around 35% efficient, with masses of heat going to waste as it is pumped out of cooling towers as steam.

If half that waste heat could be captured and used, it would cut heating demand by a quarter as well as significantly reducing carbon emissions by making the use of energy sources much more efficient.

While installing a "combined heat and power" unit makes a power plant produce less electricity, it can then produce usable heat, making its overall energy efficiency double from around 40% to 80%, ICE energy panel member Dr Keith Tovey said.

A report from the ICE highlighted two main areas in the UK which had a number of large power plants close to urban areas where the heat could be piped to homes to replace gas or electrical heating and hot water.

The two areas best suited for such a move are the region around Drax, Ferrybridge and Eggborough power stations, near Leeds, and the Kingnorth/Tilbury cluster near London.

The technology could be easily be put in place in the power plants themselves, although the high capital cost would come in laying the pipes from the plants to homes.

The installation of heat recovery schemes from existing centralised power plants where feasible could meet 5% of the UK's demand for heat and cut CO2 emissions by 10 million tonnes.

For the consumer such a scheme would remove the worry of the capital cost of replacing boilers in the home, Dr Patrick James of Southampton University said.

And in new developments, such as the Government's proposed ecotowns, decentralised schemes could see plants run on biomass and producing electricity and heat to meet low carbon commitments.

Dr Tovey said the University of East Anglia (UEA) where he was based was installing small scale CHP which would be cutting the university's carbon by 75% per student, and making it a net exporter of low-carbon power.

He said that in the context of climate change and energy security there was "enormous potential" in heat recovery.

"We're thinking about building new coal power stations, like Kingsnorth, and perhaps one of the requirements should be not just thinking about electricity but also heat demand," he said.

"We would recommend there's an assessment of heat capture whenever a new power station is being planned."

He suggested the local authority could carry out the assessment.

He also said the methods of capturing heat was compatible with technology to capture carbon and store it underground, so both could be installed on the same plant.

But while carbon capture and storage was still at the demonstration stage and not ready in the immediate future, "we could easily put in combined heat and power at this time", he said.

Power plants could also be built so they are able to switch from producing heat and electricity together to switching off the production of heat for a short time which would boost electricity generation.

Such a process would not affect the heating of people's homes but would allow for more electricity with a high sale value at times of peak demand, making it an attractive proposition for investors.