A grant of £12million has been awarded to East Riding of Yorkshire Council to help fund a new green energy centre at Goole.
The project could see the construction of the Goole Green Heat Network which will allow homes and businesses to ditch their oil and gas boilers in favour of cleaner, cheaper energy.
The council's scheme is one of seven low carbon projects across the country to be given a share of £91million in the Government's biggest ever drive to fund greener ways to heat and power buildings.
The Goole Green Heat Network is designed to extract waste heat from a nearby manufacturing plant and pump it to residents and businesses in the area.
The network will provide heat to homes and businesses, including local council buildings, from 2024, cutting the town's carbon emissions by 322,000 tonnes over 40 years and creating new skilled jobs during the construction stage.
If approved by the council, construction could begin as early next year.
Alan Menzies, executive director of planning and economic regeneration at East Riding of Yorkshire Council, said: "We declared a climate emergency back in 2021 which has placed a significant focus on sustainability and climate change across the organisation.
"The supply of cleaner, lower cost heat will not only reduce the council's carbon emissions through the supply to a number of our buildings but also allow for residents and businesses to receive a financial saving, which at such a difficult time in the energy market, is vital.
"The Green Heat Network Fund award is warmly received by the council and will ensure that our taxpayers money goes further."
It is hoped the seven projects will encourage more schemes across the country to follow suit, helping to phase out fossil fuels and moving the UK further towards its 2050 carbon net zero target.
The government's Green Heat Network Fund provides grant support for the development of new and existing low and zero carbon heat networks in England, which will provide long-term sustainable and energy-efficient heating and hot water for residents, whilst helping to reduce consumer's energy bills.