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E.ON is providing £3.4 million of funding, with the Council covering most of the remaining costs, with private homeowners paying for a share of improvements to their own homes.
More than 2,200 homes in parts of Osmaston, Cowsley, Old Sinfin, Austin, Alvaston and Allenton will be fitted with a range of energy saving measures such as insulating solid brick walls, new heating systems, cavity wall and loft insulation, and even solar panels as part of a project to help tackle fuel poverty in some of the most deprived areas in the community.
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The work, funded by E.ON, is being carried out under the Government's Community Energy Saving Programme (CESP) and could save some residents hundreds of pounds a year.
Jon Kirby, CESP Manager at E.ON, said: "We're committed to getting homes energy fit and this is a great example of councils, communities and companies getting together to help people lower their bills and reduce their effect on the planet.
"By tackling whole communities in such a way we can really start to make a difference and build energy efficiency into our everyday lives. And it's not just these homes benefiting from the investment; private homeowners can also take advantage of reduced rates on similar energy efficiency measures."
Under CESP, more than £350 million will be invested by energy companies up until 2012. The scheme was created in September 2009 to give whole-house energy makeovers to 90,000 hard-to-treat homes across England, Wales and Scotland.
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