Subgrid-scale (SGS) modelling is formulated using a local transport of spectral kinetic energy estimated by a wavelet multiresolution analysis. Using a spectrally and spatially local decomposition by wavelet, the unresolved inter-scale energy transfer and modelled SGS dissipation are evaluated to enforce explicitly and optimally their balance a priori over a range of large-eddy simulation (LES) filter widths. The formulation determines SGS model constants that optimally describe the spectral energy balance between the resolved and unresolved scales at a given cutoff scale. The formulation is tested for incompressible homogeneous isotropic turbulence (HIT). One-parameter Smagorinsky- and Vreman-type eddy-viscosity closures are optimised for their model constants. The algorithm discovers the theoretical prediction of Lilly (The representation of small-scale turbulence in numerical simulation experiments. In Proceedings of the IBM Scientific Computing Symposium on Environmental Sciences, pp. 195–210) at a filter cutoff scale in the inertial subrange, whereas the discovered constants deviate from the theoretical value at other cutoff scales so that the spectral optimum is achieved. The dynamic Smagorinsky model used a posteriori shows a suboptimal behaviour at filter scales larger than those in the inertial subrange. A two-parameter Clark-type closure model is optimised. The optimised constants provide evidence that the nonlinear gradient model of Clark et al. (J. Fluid Mech., vol. 91, issue 1, 1979, pp. 1–16) is prone to numerical instability due to its model form, and combining the pure gradient model with a dissipative model such as the classic Smagorinsky model enhances numerical stability but the standard mixed model is not optimal in terms of spectral energy transfer. A posteriori analysis shows that the optimised SGS models produce accurate LES results.