HUNDREDS of households could benefit from more affordable energy bills thanks to a multi-million pound deal signed this week.

A pilot programme will see state-of-the-art heat pumps installed in hundreds of homes – generating cheap, clean electricity. Initially, the technology will be fitted into 300 social housing properties. If it’s successful, it could be rolled out to thousands of homes across Greater Manchester.

The technology generates energy using a combination of low carbon heat pumps and a remote ‘smart grid’ management system. This will be the first time it has been used domestically anywhere in the world.

The deal to bring the trial to Greater Manchester was struck between Japan’s Department of New Energy and Development Organisation (NEDO) and the Association of Greater Manchester Authorities (AGMA). The UK Government has also backed the initiative. It could see up to £20 million invested in the local economy.

It’s hoped the pilot project will help develop technology that could reduce the country’s reliance on fossil fuels. The technology will create new supplies of renewable electricity, help keep energy costs low and assist in meeting climate change targets. The technology will be up and running by 2014 – subject to detailed study.

Leigh Councillor Lord Peter Smith, Chairman of AGMA and Leader of Wigan Council, said: “We have been working closely with our colleagues at NEDO, who bring a huge amount of technical knowledge and passion for green energy to this project. This agreement takes us into the next phase involving detailed work on the potential project.

“This agreement builds on the successful work we have already been doing to create a low carbon hub in Greater Manchester and is another economic energy success story for our region. I am personally delighted that NEDO has chosen Greater Manchester to develop this project.”

Ashley Crumbley, chief executive of Wigan and Leigh Housing, said: “This agreement builds on the work we have already carried out across Greater Manchester using energy saving equipment and green energy generating technology such as solar panels, which has resulted in thousands of homes now benefiting from lower bills.

“By working closely with NEDO to further develop this state of the art technology, the project could pave the way for a large scale replacement of gas boilers with a new form of heat generation.