The UK's churches and other religious buildings such as mosques could raise up to £34 million a year by installing solar panels on their roofs, British Gas suggested yesterday.

The company estimates religious centres could generate more than £29 million from feed-in tariffs, which pay households and organisations for the electricity they generate from small-scale renewables.

And they could make savings of £5 million a year on electricity bills by generating their own power from solar panels.

Installing the renewable energy technology would also help religious organisations save up to 42,000 tonnes of carbon dioxide each year, according to British Gas's green streets programme.

The programme features 14 communities competing to save and generate the most green energy with funding from British Gas - with the winners scooping a £100,000 prize for their local area.

Phil Bentley, managing director of British Gas, said: "These potential savings are great news for the UK's religious buildings and their congregations and give them the opportunity to lead their communities in tackling climate change and helping Britain move towards a low-carbon society.

"Religious buildings are particularly well suited to solar power as they tend to have large south-facing roofs which receive direct sunlight for the main part of the day."

And he added: "The government's feed-in tariff scheme is the key to unlocking the potential of solar power in Britain."

Some churches and other faith buildings are already cashing in on benefits of installing solar panels. St Silas Church in Pentonville, London, has covered the greater part of its south-facing roof with solar photovoltaic tiles which are designed to blend into the surrounding roof to generate electricity.

And in Birmingham, the Masjid-e-Hamza Mosque, part of the green streets scheme in Mosley, aims to benefit from feed-in tariffs by installing solar panels.

The mosque expects to be £6,400 a year better off as a result of the solar panels - and will use energy created to heat water used in the Muslim practice of ritual washing known as wudu.

British Gas estimates that if all 16,247 Church of England churches in the UK - many of which point east and have large south-facing roofs as a result - were to install solar panels they could save almost £2.8 million on bills and make more than £17 million from feed-in tariffs.

Mosques, synagogues and Hindu, Sikh and Buddhist temples could also benefit from installing the renewable energy technology.