Middleton Cheney is upgrading all of its 175 street lights from bulb-based systems to more energy-efficient LED technology.
Installation of the new street lights has already started and is expected to be completed by the end of August.
Once installed it is expected that each light will save the village £60 in electricity per year, with the total savings meaning that the whole project will pay for itself within five years.
Local authorities across the UK are in the process of transitioning from the traditional bulb-style lighting to LED, as the technology offers cash savings and also saves significant amounts of carbon.
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Middleton Cheney parish councillor Ruth Hoose said "This is a fantastic opportunity for the parish to continue to move towards being a greener village. We also look forward to less maintenance and a higher quality of lighting for all".
Bicester-based Zeta Specialist Lighting was awarded the contract by Middleton Cheney Parish Council and will unveil its new Aspire street lighting range on the project.
The Aspire range was specifically designed for Oxfordshire City Council to use within sensitive conservation areas.
CEO of Zeta Specialist Lighting, Phil Shadbolt OBE, said "We are delighted to have been awarded the contract to upgrade and improve the street lighting in Middleton Cheney.
"It's a beautiful village and we're confident residents will appreciate the style of the village's new lighting and also the quality of light they provide."