An Australian Energy Market Commission report released last week says the price of residential electricity is estimated to start falling next year and continue to fall until 2022.

The report says NSW electricity prices are estimated to fall overall by 8 per cent or $107 thanks to extra generation capacity from an increased supply of renewable power, lower distribution costs and falling green scheme costs.

Cr Shields said the state and the federal government should look at Dubbo as a "great place to invest in renewable energy projects."

"The Dubbo region is the perfect region to invest in because there is plenty of sun and wind out here," he said.

"But we are also on important truck lines when it comes to the electricity power supply, particularly Wellington, which is why we are in an ideal place for solar and wind farms.

"As much as I am sceptical that renewable energy can be baseload at the moment I also know the only way for renewable energy to eventually take over baseload power is for further investment in it and for society to use it more.

"The only way renewable energy is going to become more reliable is for the technology to develop and enhance, and the only way for that to happen is if there is greater consumer need for it.

"More investment in renewable energy like wind and solar would make industry and innovation work to get its technology even better. But, if we hide from it and say it is not capable now, it will never work. We can't bury our heads in the sand."

Deputy mayor Stephen Lawrence agreed the Dubbo region would be the perfect place to host renewable energy projects providing proper attention was paid to correct land use.

"There is an array of renewable energy technology that can be used in conjunction with agriculture, that includes wind turbines and solar panels where animals can graze under them and so forth, and by hosting them farmers can create a new income stream," he said.

"The types of projects are usually significant and approved by the state government, and if they do go ahead, the groundwork should be done to make sure communities are properly consulted."