The solar and battery storage project nearing completion in the community, also known as Nauiyu, will provide its entire daytime energy needs and reaches the Labor government's 50 per cent renewable energy target.
The $55 million program, which is jointly funded by the Territory and federal governments, will deliver 10 megawatts of solar energy across 28 remote communities.
It will reduce their reliance on diesel fuel by approximately 15 per cent, reaping savings of up to 94 million litres of fuel over the lifetime of the project.
Due for completion in September, the Daly River site incorporates a lithium-ion battery, charged by 3,200 solar panels, which will enable the community's diesel engines to be turned off.
That'll save 400,000 litres of fuel every year, meaning half as many fuel trucks on the road, Essential Services Minister Gerry McCarthy says.
"Once the site is commissioned, the diesel generators will only operate at night, leading to improved local air quality and a cleaner, greener community," he said.
"We expect solar and battery technology to become more economically viable."
Mr McCarthy says the Daly River project investment will be approximately $6.2 million and will create more jobs and greater power reliability.
"As battery costs rapidly reduce over the next few years, we expect solar and battery technology to become more economically viable," he said.
He said it was another step in combating climate change to achieve the goal of 50 per cent renewables by 2030.