Barratt has been chosen by the department for Communities and Local Government as preferred bidder to build the UK's first eco-village.
The eco-village will be built at the site of the former Hanham Hall Hospital near Bristol and will conform to the government's Code for Sustainable Homes.
It forms part of government plans to build two million new homes in Britain before 2016 and to reduce the UK's carbon footprint.
Housing minister Yvette Cooper said: "We have set a world-beating target that all new homes must be zero carbon by 2016.
"People said this couldn't be done, but, in fact, this first Carbon Challenge site shows developers are already preparing to build the first major development of zero carbon homes."
Barratt said it fully supports the zero carbon objective wants to make as "big a contribution as we can".
Meanwhile, a former coalfield site in Wigan, west Manchester is set to become a zero-carbon housing development as part of the Carbon Challenge run by English Partnerships.

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Date Published: 17 December 2007