Newcastle will be the heart of Australia's first commercial-scale smart grid after a consortium led by EnergyAustralia won the federal government's $100 million Smart Grid, Smart City bid yesterday.

Minister for Environment, Climate Change and Water Senator Penny Wong delivered the news at CSIRO headquarters in Mayfield West.

She said the EnergyAustralia project, which trumped three other bids, would help households save energy, connect renewable energy to the grid and tackle climate change.

"This is a transformation of the energy network from the power plant to the power point," she said.

"If smart grid applications are adopted around Australia they could deliver a reduction of 3.5 megatonnes of carbon emissions a year."

Under the project, 50,000 Hunter and Sydney homes will have new generation smart electricity meters installed, with about 30,000 going to homes in Scone and Newcastle.

A fleet of 10 electric vehicles will be introduced to the region and in the biggest move towards giving households control over energy use, Hunter homes will be among 15,000 transformed into "smart houses".

"These homes will be able to remotely control appliances like airconditioners with their mobile phone or laptop to help reduce energy use and greenhouse gas emissions," EnergyAustralia engineering general manager Geoff Lilliss said.

Newcastle MP Sharon Grierson said the homes would use in-house displays and a website to help residents better understand their energy use.

"Households will be able to access information about the amount of energy used at any time in their home and cost," she said.

The three-year project, ready to be rolled out as soon as contracts are finalised, has been forecast to put Newcastle on the world stage.

"Australia will be looking at this project in Sydney and Canberra but I can assure you it will be looked at in boardrooms across the world," Mr Lilliss said.

Hunter Business Chamber president Peter Shinnick said the project would stimulate big investment in the region, attracting businesses that were looking for an operating environment that encouraged innovation in energy use.

"Smart grids are the technology the world will want," Senator Wong said.