Councils are to be allowed to withdraw funds from the Community Infrastructure Levy to finance local renewable energy generation schemes.
The government has also outlined plans for new homes to be zero carbon within the next six years.
Last month the coalition government decided to push forward with the CIL, a tax on new development introduced by the previous government.
Housing minister Grant Shapps said: “If we’re going to be successful in reducing our carbon emissions, we need to ensure the councils and developers who are going to deliver these changes are on board.
“That’s why we’re also giving the people at the sharp end of delivering zero carbon further options to invest in local renewable energy schemes, which will provide councils and developers the flexibility they need to meet these standards.”
Meanwhile, pressure groups have called for a Community Energy Fund, which would pave the way for zero carbon building through contributions to a fund that reduces carbon dioxide emissions.
Government officials will also use data from the work carried out by the Zero Carbon Hub to reduce carbon emissions from new development.