Free electricity will be made available to 1,000 council tenants if a pilot scheme to install solar panels on roofs in Leeds gets the go-ahead.
The innovative idea being developed by Leeds City Council in partnership with Leeds-based not-for-profit enterprise CES would save residents on average more than 100 a year, with the surplus being sold back to the National Grid.
Each unit of rooftop-created electricity would generate an income of 41p under the Government's Feed In Tariff incentive scheme, which would pay for the initial cost of installing the panels.
Any profit could potentially cover the cost of rolling the scheme out to both council-run and private homes.
The proposed solar panel plan would also cut carbon monoxide emissions in the city by 872 tonnes a year. Currently 29 per cent of CO2 comes from domestic energy use.
Coun David Blackburn, chairman of the Leeds City Council's cross-party environment and climate change working group, said: "Tenants get free electricity and we get to invest still further into making the city more energy efficient.
"Just going about your daily life can create quite a lot of CO2 emissions and we need to work together as a city to address this.
"There are many ways for people to do their bit by using low-energy light bulbs, recycling or insulating for instance.
"This project will provide clean, green energy that will save people a lot of money."
The pilot scheme will be debated by members of the council's executive board on Wednesday, who will hear that if the scheme was expanded to 10,000 homes it would provide enough cash to:
* Fund cavity wall or loft insulation for 64,500 private homes;
* Save around 11 million a year on fuel bills;
* Reduce CO2 emissions by 68,000 tonnes a year.
If the scheme is approved the council will identify 1,000 suitable homes for the solar panels to be installed by CES by March 2012.
Energy production will be monitored by CES and panels maintained for 25 years.
Earlier this week, Kirklees Council agreed to invest 6m in solar technology to help 1,000 disadvantaged households.