A new community electricity tariff for the Western Isles is earmarked to be launched in April.
Over the next seven months, Western Isles Council will firm up plans for a joint venture with an existing licensed electricity supplier offering a special rate to local families and businesses.
Cutting household bills by around £130 a year is a “realistic target to aim for” in the short term, according to the council.
Savings should be greater in the coming years, it is hoped.
The “white label” partnership with a commercial operator will allow the council-owned Hebrides Energy supply company to “gain valuable experience of operating in the energy market as it seeks to secure its own licence and look at opportunities to generate cost savings through direct investment in generation”, a council report said.
In the longer term, the council intends to negotiate agreements with a raft of community wind turbine operators and the commercial operator of the planned large Stornoway windfarm – to buy and resell electricity generated on local moors to island customers.
A report by council strategy officer, Anne Murray, said: “Discussions are now under way with a potential private sector partner.
“Initial proposals are encouraging in terms of the potential tariff offer.”
However, she highlighted: “The company is relatively new to the energy market and also lacks experience on this type of project.
“Even if an agreement is reached, it will not be without risks for Hebrides Energy.”
She added: “The provisional timescale for launching the Hebrides Energy community tariff is April 2016.”
The council points out any wholesale electricity supplier supporting the planned energy supply company would not achieve much savings as it will bear all operational costs and risk.