The Local Government Authority (LGA) has called for energy suppliers to make a compulsory £500 million contribution each year towards boosting energy efficiency, reports the Press Association.
According to the organisation, the additional funding would help to escalate the rate at which UK homes could be fitted with energy-efficient measures such as cavity wall and loft insulation, helping more than half a million people gain better access to cheap energy.
Savings of around £280 a year would be possible and as many as 20,000 new jobs would be created in the form of installation engineers and additional workers.
Sir Jeremy Beecham, vice chairman of the LGA, told the news agency: "As the economy has entered into a recession, insulating existing homes must remain a priority that can create jobs and help those struggling to pay their fuel bills."
Many people have been struggling with price rises from energy suppliers for many months. Consumers could choose to switch energy supplier to pursue cheaper rates, although the major suppliers have said prices could be falling soon.
Last year the government rejected proposals to impose a windfall tax on energy suppliers.
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