The Mayor's office has announced that the GLA has become the first local authority to apply for a licence to become an energy supplier.
Initially it will allow the Greater London Authority to buy excess electricity produced by London's boroughs and public bodies before selling it on, at cost price, to other public sector organisations, such as Transport for London, the Met Police and NHS hospitals.
It is hoped that this will incentivise London boroughs to increase their energy-producing capacity. The Mayor is working with Ofgem and the Department of Energy and Climate Change to bring this new route to market by early 2014.
The GLA says Increasing revenues for smaller generators will improve the viability of local energy projects in London and spark an investment boom in the capital's low carbon energy infrastructure.
In the short term, it could help bring in more than £300 million worth of investment for 22 heat and power projects already in the pipeline. In the longer term, it could help generate over £8 billion of investment and around 850 jobs a year until 2025.