ScottishPower hopes to revamp the electricity network in Scotland's biggest city over the next decade.
It will mean households with home energy devices such as solar panels or turbines could generate their own electricity and sell it to the grid, making a profit. And the "smart" electricity grid would enable a new generation of home appliances to operate only at times of lowest demand.
Washing machines or dishwashers could switch themselves on in the middle of the night, when demand for electricity is lowest and cheapest. This would help save money on bills, and balance out electricity demand to avoid the huge peaks and troughs that cause instability. The new network would also be capable of supporting widespread use of electric vehicles.
ScottishPower aims to carry out the ambitious plans over the next five to ten years. The company will use its own investment, as well as seeking funding, and has set up a team of engineers to work on the concept.
It has already lodged a bid for 6million from the Department of Energy and Climate Change's Low Carbon Investment Fund towards the plans. And the company is already carrying out a pilot scheme in Glasgow's east end to test out the techniques involved, as part of the Clyde Gateway regeneration project.
Frank Mitchell, director of ScottishPower energy networks, said it was about bringing the electricity supply into the 21st century.
"Historically, the flow of electricity has been a one-way process, from large power stations to the plug. Now, with increasing renewable electricity production and the opportunity for individual households to generate their own power which can be fed back into the grid, the existing network is fast becoming outdated."
ScottishPower said the so-called "smart grid" would improve the reliability and quality of electricity supplies, as well as increasing energy efficiency and reducing bills.
"In order to move our homes and workplaces towards being carbon neutral, we need to use technology to manage and control the appliances we use more efficiently," said Mr Mitchell.
He added: "Smart grids will be able to automatically start selected appliances, such as washing machines, or even factory equipment, when the cost of electricity is at its lowest in off-peak hours. During the periods of highest usage it could do the opposite, turning off unnecessary appliances to reduce demand and save energy."
Intelligent monitoring devices will keep track of all electricity flowing in the system so that it operates in the most efficient manner.
Smart meters will be installed in homes, which will enable households to see how much electricity they are using at any one time, and how much it is costing.