A new proposal to make Irish buildings more energy efficient could generate up to 40,000 jobs in the building sector, the Construction Industry Federation (CIF) said today.

The plan, which was developed in conjunction with manufacturers of energy efficiency technology and materials, could also save almost €1 billion in energy costs, which goes out of the country each year, the CIF said today.

The proposal looks at the possibility of "deep energy retrofitting" Ireland's existing residential, commercial and public buildings, and requires some public funding to kickstart the programme.

CIF director general Tom Parlon called on the banks to provide green loans to consumers who want to take part in such a programme.

He told RTÉ's Morning Ireland that the previous retrofitting programme was successful in terms of raising public interest, but was too "shallow" and was limited to only a few thousand per house.

"The SEI were limited in their resources. We're suggesting a much deeper retrofit; you need to spend up to €20,000 per household, and also to extend it into public buildings," he said.

"If you take a typical house which spends about €2,000 a year, it is very easy to halve that and have a much better quality of life and much better living conditions in your house."

Mr Parlon said individuals and utility companies could be encourage with a small incentive.

However, there would still be a requirement for the State to partly fund the plan.

"Last week we were talking about sorting out the banks and recapitalising them, now we need to get some economic activity. Certainly it has been bad news for construction workers. This is an opportunity."

According to the CIF, the plan would inject cash into the Irish economy immediately, and even if 100 per cent funding was provided, there would still be a benefit to the State in terms of employment.

The plan is to be presented to the Government today.