Farmers and landowners in England's uplands should be paid for protecting the landscape and providing clean water, storing carbon and preventing floods, a report for the Government said today.
The report by the Commission for Rural Communities (CRC) also said the Government should support to help green businesses develop to help the often-deprived areas spearhead the low-carbon economy.
Whitehall should also demand local authorities carry out audits of the opportunities for renewable energy schemes such as hydropower to stimulate new enterprises, the report said.
According to the study, England's uplands, home to two million people and covering 17% of the country, could lead the way in providing green and low carbon solutions to environmental issues.
In the future, with rising food prices, the threat of climate change and a growing world population, there will be growing pressure on land to produce food and fuel, provide clean water, prevent flooding and lock up carbon in woodlands and soils.
The uplands provide important natural assets, locking up 200 million tonnes of carbon and providing the source for 70% of drinking water, while their National Parks have 40 million visitors a year, generating £1.78 billion.
But the areas face issues including low housing availability, a lack of access to services ranging from health care to mobile phone networks and broadband and limited employment opportunities.
The CRC report said current policies to support the uplands were too top-down, fragmented, uninformed and "one-size-fits-all", and a new national strategy was needed to make communities sustainable.
Recommendations in the report include targeting funding under the Common Agricultural Policy (CAP), which is up for reform, to reward farmers for protecting natural assets.
And markets need to be developed to pay land managers for storing carbon and protecting water supplies.
Specialist advice should be provided to develop new green businesses, while local authorities should carry out audits of opportunities for renewable energy.
Programmes and incentives to stimulate green projects should make sure that benefits go to local communities first, the report said.
And investment in universal mobile phone coverage and broadband are needed to help businesses operate more effectively, provide access to services and enable social contact among young people and families, the report urged.
The report said: "Rather than defining these areas purely by their agricultural disadvantage, the nation should be considering them as areas that offer great public benefit and environmental value.
"Not only are they iconic landscapes, providing space, tranquillity, beauty and preserving cultural heritage, but they are also working areas that deliver crucial goods and services to sustain and support human livelihoods."
And it said: "The uplands could provide green and low carbon solutions to environmental issues, and lead the way on developing the green economy, demonstrating and promoting the benefits of working with and making the most of the natural and cultural land assets."
Ian Woodhurst, Senior Rural Policy Officer for the Campaign to Protect Rural England, said: "This report rightly recognises the important role our uplands have in tackling future challenges whether it's providing food, water management or carbon capture."
"We need to banish the negative mind set many people have when thinking about upland communities. They are not just disadvantaged, declining and remote.
"They have a vital role in helping to tackle the nation's future environmental challenges.
"But, for them to be capable of delivering this role we need close partnership working between upland communities, Government departments and agencies, local authorities, businesses and environmental organisations.
"This will give them a truly environmentally sustainable future."
Country Land and Business Association (CLA) vice-president Henry Robinson said that in addition to farming, the uplands were well suited to provide other benefits such as renewable energy.
He said the report should have gone further in recognising the need to remove some of the restrictions, particularly within the planning system, that prevented roll-out of green energy.
And he said: "The rural economy and creating jobs should be permitted to lead the requirement for new housing.
"The small amount of land available for development in uplands areas must have a mixed use for employment, housing and services."