Liverpool LECCy' aims to cut costs of fuel bills for residents hit hard by higher tariffs.
Next week, the council’s cabinet will be asked to approve proposals to start the process of setting up a company providing energy to Liverpool households.
They say that as well as cutting costs to householders it would also help to improve energy efficiency across the city and look to develop innovative ways of generating energy.
This move comes as the latest figure show one in seven households in the city live in fuel poverty and over 70,000 households – a third of all in the city – use costly pre-payment meters which are estimated to cost an extra £226 a year compared with those who use the cheapest direct debit tariff.
The Mayor of Liverpool, Joe Anderson, said: “Cutting fuel bills is one of most significant ways we can help provide real and lasting benefit to Liverpool people.
“I want us to do something practical to help tackle fuel poverty, which is why we’re setting up this energy company – the Liverpool LECCy – which will be owned by and run for the people of the city, giving them a cheaper alternative energy provider.
“It’s absolutely heart-breaking how many families in this city are reliant on expensive prepayment meters and are, in effect, being penalised by paying more for their energy than those who are able to use direct debit, especially as single parent families are the hardest hit.”