UP to 400 new sustainable homes will be built across Wales as part of a unique project announced today by the Assembly Government.

The £80 million scheme will see 22 projects constructed in both urban and rural locations.

All the properties will be built to the highest green standards, known as levels four and five of the Code for Sustainable Houses.

The initiative is a direct response to one of the first five steps recommended by the Essex Report into affordable housing in Wales.

Revealing details of the pilot, Jocelyn Davies, deputy minister for housing, said: "Less than five months after the report was published we are taking action to deliver one of its key recommendations.

"The review encouraged housing associations to provide new homes to higher standards that will reduce carbon emissions and increase energy efficiency, which will help cut household fuel bills. This pilot scheme will help us investigate how we can achieve this on a large scale."

Jane Davidson, minister for environment, sustainability and housing, added: "I have already set targets for sustainability standards in new buildings as part of tough new planning policies to tackle climate change.

"The planning system needs to do more to encourage the take-up of new renewable energy technologies by developers to help Wales play its part in tackling climate change.

"Rising fuel bills affect us all — and the homes in this pilot area will have lower bills and help to reduce our carbon footprint.

"A key issue in the coming decades for all housing will be long-term affordability. The question is not just how much a home will cost upfront, but how affordable will it be to live in and run."

The project aims to help Welsh ministers understand the implications of building homes to the higher standards of the Code for Sustainable Homes.

It will also help the building industry develop the skills and confidence required to deliver homes in the mass housing market.