A Commonwealth government grant will enable the Break O' Day, Dorset and Glamorgan Spring Bay councils to consider opportunities for economic diversification while protecting environmental and cultural heritage values.

Break O' Day community services manager Chris Hughes said the project would tie in with the three councils' land use and development strategies and improve planning for matters of national environmental significance.

She said the study was expected to take consultants 15 months to complete and investigate potential developments, such as a new walking trail between Musselroe Bay and Coles Bay.

"Consultants will be meeting with the community from next week talking to focus groups and stakeholders," Mrs Hughes said.

"It is envisaged that access points along the track will provide opportunities for further tourism developments and adventure experiences such as walking to the Blue Tier from the Bay of Fires.

"It is also about working with potential developers because a lot of them are constrained by some environmental issues, but there may be some outcomes from this study that we can use to work with developers."

The regional sustainability planning approach is funded by the federal government's Sustainable Regional Development Program, which is investing $29.2 million over four years to create "strong and sustainable regional centres across Australia".