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The government should do more to stimulate local energy projects as a means of reducing the UK's reliance on fossil fuels, a group of MPs has said.

In its latest report, the Commons trade and industry select committee said local energy or 'microgeneration' could improve energy security and help plug holes in the grid.

Local energy refers to small-scale projects that make use of low carbon sources to produce heat or electricity.

Examples of successful local energy initiatives include the installation of solar panels or miniature wind turbines on the roofs of houses.

The committee calls on the government to do more to encourage people to invest in these types of project, as they can provide energy for a home or business and also make a contribution to the grid.

"Government policy could, and should, do much more to encourage the development and take-up by consumers of local energy," the report said.

"This will help create the mass market, which will reduce the costs of local energy systems for consumers."

This follows sharp rises in domestic energy bills over the last 12 months despite intense competition among providers.

As well as rising prices, there are concerns about the security of supply with unrest in key oil-producing regions, as well as an unpredictable government in Russia, the EU's main exporter of natural gas.