At present, the estimated 6,000 privately-owned and council properties that are connected to the system pay one flat rate a year for power, irrespective of how much they use.
Next week Sheffield Council’s cabinet committee will consider plans to instead install heat meters in those homes, to give people greater control over their energy supply.
Coun Harry Harpham said: “The 6,000 or so properties that currently use the district heating system will have a meter installed so that they can see exactly how much heat they are using and be in control of their bills - that way people can use as much or as little heat as they like.
“This is a large programme and one that many residents have been crying out for.”
Sheffield’s district heating network is said to be the largest in the UK and is still growing.
As well as residential buildings it serves well-known city landmarks such as the Sheffield City Hall, the Lyceum Theatre and its two universities.
If approved at the meeting on Wednesday work could begin next spring, and take three years to be completed.