THE government has unveiled proposals for local communities to generate their own energy.

Britain's first Community Energy Strategy aims to encourage people to come together to reduce their energy use or purchase and generate their own energy.

The government says doing so will enable communities to control their energy bills and help transform the energy system.

Over 50% of people surveyed by DECC said that saving money on bills would be the major motivation for getting involved with community energy schemes.

About 3.5 million bill payers are ready to get together with other people in their local community to take more control of their energy, said the government.

Meanwhile while four in ten respondents said they were already interested in joining a community energy group, and taking part in collective switching or collective purchasing schemes.

Energy and Climate Change Secretary Ed Davey said the cost of energy was now a major consideration for household budgets.

"I want to encourage groups of people across the country to participate in a community energy movement and take real control of their energy bills.

"Community led action, such as collective switching, gives people the power to bring down bills and encourage competition within the energy market."

Plans include a £1m Big Energy Saving Network funding to support the work of volunteers helping vulnerable consumers to reduce their energy.

An urban fund will now sit alongside the existing Rural Community Energy Fund (RCEF).

The government has also announced a community energy saving competition, offering £100,000 to communities to develop innovative approaches to saving energy and money.

Meanwhile, a "one-stop shop" information resource is being launched for people interested in developing community energy projects.

Energy minister Greg Barker said the Community Energy Strategy would bring communities together – helping them save money and make money too.

"The coalition [government] is determined to unleash this potential, assist communities to achieve their ambitions and drive forward the decentralised energy revolution.

"We want to help more consumers of energy to become producers of energy and in doing so help to break the grip of the dominant big energy companies."

Since 2008, at least 5000 community groups have participated in energy projects in the UK.

The Ashton Hayes project in Cheshire, for example, saved local households an average of £300 a year by encouraging behavioural change and installing simple energy efficiency measures.

The government believes community shared ownership schemes will help ensure that local people reap the financial and social benefits of renewable energy developments in their area.