Energy minister Greg Barker dropped in at a community hydro-electric scheme in Halton this week.
The MP was shown around the Halton Lune Hydro project, which is expected to provide power for up to 300 homes when it opens later this year.
Work began on the £1.25m hydro-electric turbine on the River Lune near Halton in December 2013.
Since then a dedicated group of local people have been constructing the foundations.
It is thought that, when finished, the hydro will be one of the biggest community hydro-electric schemes in the UK.
The electricity generated by the equipment will be enough to power the 40 properties which make up the Halton co-housing site further up the river, with any excess being sold to the National Grid. The project is being funded predominantly by Government funding, EU funding and through a community share offer.
All of the profits will be invested into a trust, with local individuals and community groups able to apply for some of the money.
Mr Barker said: “Clean energy is a big growth area and an important priority for the coalition government.
“Projects like this are making a real difference and I am really pleased to see the local community and government working hand in hand. Clean energy is an essential part of our long term plan.
“It is working with the natural environment and in-keeping with the landscape. It’s an enhancement to the local area and is highly efficient.
“The fact that so many people are putting in their own money alongside money from the government is a real vote of confidence in clean energy.
“This scheme is an example which I think lots of other people will be keen to follow.”
Morecambe and Lunesdale MP David Morris accompanied the minister on the tour.
He said: “Halton Lune Hydro is a fine example of the community working together to generate clean energy.
“When Halton Lune Hydro is up and running it will generate around 1,000 MW of electricity, which is enough electricity to power around 300 homes.”
* The organisation behind Halton’s eco-housing project, Lancaster Co-housing, won the community energy award in the Observer Ethical Awards last week. Local people can invest in the hydro project until September.