Lancashire County Council has objected to plans to store natural gas in caves beneath Preesall.
The report has been submitted in the county council's role as one of the statutory authorities being consulted by the national Planning Inspectorate, which will decide on plans put forward by Halite Energy Group.
Cllr Michael Green, member for economic development, environment and planning, said: "These proposals are considered to be on a national scale because of their potential impact on energy supplies, which is why the national Planning Inspectorate will ultimately decide whether they go ahead.
"But the impact of the development site on the local area would be considerable and it is only right that we have thoroughly examined the proposals and commented on them in detail.
"We have concluded that the detrimental impact this scheme would have on the rural and coastal areas included in the plan far outweighs the intended benefits.
"The scale and design of the proposals does not, in our view, sufficiently protect the landscape or natural environment for future generations."
The county council's report also calls on the Planning Inspectorate to seek assurances about the safety of the proposed development.
Cllr Green added: "It is not for us to judge whether the proposed operations are safe but we are urging the Planning Inspectorate to seek robust evidence that these proposals would prevent the escape of gas from the caverns and avoid causing seismic movement.
"We are also asking them to seek assurances that nearby residents and people visiting the area near the caverns wouldn't be placed at risk by operations at the site."
John Roberts, chairman of Halite, based in Kirkham, said: "There is an urgent need to bring forward major infrastructure schemes such as the one we are proposing to stimulate growth and provide much needed jobs in the UK. Halite is absolutely committed to ensuring that Lancashire benefits from the project. During the coming months we will be engaging with local businesses, schools, colleges, universities and a range of other stakeholders to explore every opportunity to generate jobs locally, invest in the supply chain in Lancashire and utilise the project as an educational resource for young people."
The Planning Inspectorate's decision is due by April 2013.