Australia's first community-owned clean energy generator and retailer is taking shape in the counter-culture capital of Australia.

Known for its alternative lifestyles, the Northern Rivers region of New South Wales is hoping to establish a not-for-profit energy company - Northern Rivers Energy - to rival the big retailers.

The electricity industry however remains highly sceptical a renewable energy generator and retailer would be able to compete on price.

It has been a magnet for so-called hippies, surfers and tree changers so it is no surprise councils and businesses in this eco-friendly region of NSW are turning to solar for a range of industrial practises, while local dairy and sugar farmers are generating their own electricity from methane and cane waste.

"There are lots of ideas in the community for ways to generate renewable energy," said Alison Crook, a successful businesswoman who moved to the area a few years ago.

From her home in Byron Bay's lush hinterland, the one-time Qantas Businesswoman of the Year is designing a first for Australia - a not-for-profit community-owned company that generates and sells locally made renewable energy.

"Just look at the environment. It's worth protecting. Renewable energy is the way to do that," Ms Crook said.

"If we can demonstrate within this community that it's possible, other regions are already saying to us if you can create a model we'll use it."

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Northern Rivers Energy wants to attract 20,000 members, who would be able to buy, generate or invest in the enterprise.

After a feasibility study funded by the NSW Government is completed, a series of public meetings will begin.

Ms Crook has little doubt the people of the Northern Rivers will seize the opportunity to take control of their energy production.

"It's power to the people," she said.

But while there remains an abundance of available and cheap coal-fired power, the Electricity Supply Association (ESA) believes Ms Crook's vision is unachievable.

"It would be a significant challenge to make that model work even at a not-for-profit level at a price that's even remotely competitive with conventional retail electricity," ESA spokesman Matthew Warren said.

Byron Bay locals leading sustainability charge

One former industry insider, Steve Harris, is out to prove the sceptics wrong.

Before retiring to Byron Bay he was a senior manager in Origin Energy's retail business.

When he heard about Northern Rivers Energy he contacted Ms Crook offering his expertise.

"I think it's a fantastic idea. It's never been done before but I don't see any reason why this shouldn't be successful," Mr Harris said.

Local organic food producer Brookfarm is one of several businesses signing up in advance.

"Anything that can improve outcomes for environmental sustainability is really what we're all about. The most important thing is getting everyone involved," spokesman Will Brook said.

"And someone's got to lead the way."

Brookfarm's rooftop solar often makes more electricity than its manufacturing requires.

Mr Harris claims a community-owned retailer would aim to pay more for that excess generation.

"Any energy they export we'd hope to offer them a better rate than what they're getting now because the current feed-in tariffs are abysmally low," he said.

"Equally, anyone who imports energy again we'd hope to offer them a better rate than what the current energy retailers are offering."

Rooftop solar and other renewables attractive for communities

With a surge predicted in rooftop solar and other power sources, renewable energy expert Giles Parkinson said consumers should expect profound change to electricity systems.

"The traditional domination by the three big retailers, that's something of the past. How it evolves will be very interesting to see but certainly community ownership and the community-owned retailer is one of those options and we've seen it happen in Germany and other parts of Europe where it's very powerful because you have people grouping together," Mr Parkinson said.

"They're not trying to make massive profits and they're responding to what the people want to do."

Mr Harris said the idea would be attractive to many.

"The local community will want to be a part of this scheme to reinvest any money we make because we'll be a not for profit business and we'll be looking to reinvest in many different ways," he said.

John Truman, manager of civil services for Ballina Shire Council, said his was one local council keen to get involved.

"We're very interested in renewable energy sources so the opportunity to talk to anybody to assist in our future projects is something we'd be very interested in," Mr Truman said.