The emerging green construction industry looks set to receive a major boost after the government today announced the shortlist of 15 sites for its ecotown initiative.

As the most ambitious national house-building programme since the new towns of the Sixties, the plan could see a total of up to 200,000 homes built in the next 12 years.

Five new towns of up to 20,000 houses will each be built by 2016, with the other five projects following by 2020.

"Some really innovative green ideas have been proposed – from free public transport for all residents, to using the waste heat from nearby power stations to heat homes and businesses," said housing minister Caroline Flint.

The government has confirmed that none of the settlements will be built on green-belt land and most are proposed for former brown-field sites. For example, one proposal for Middle Quinton in Warwickshire plans to build six thousand homes on the site of a former Royal Engineers depot, while 5,000 homes are planned on the site of the former Fradley airfield in Staffordshire.

The short listed locations will now face public consultation and a detailed sustainability appraisal to assess the merits and challenges of each project.

Flint added that the government also plans on using a panel of experts to challenge developers to go further with their proposals and meet the "highest standards possible for sustainability, affordability and creativity".

While welcoming the proposals and the boost the new towns will give to the green construction industry, Matthew Billot at environmental consultancy WSP Environmental warned that issues still needed to be resolved over the funding of the new settlements.

He voiced concerns that from a developer's perspective low or zero carbon projects will require considerable investment in new green technologies and infrastructure, which could clash with the drive for high volumes of affordable housing. He also warned that some form of community carbon charge may be needed for residents of the new sites to meet the cost of local energy generation. "We need clarity on who will foot the bill," he added.

Colin Morrison, also of WSP Environmental, urged the government to deliver more clarity on the environmental standards the ecotown projects will have to adhere to. He said that currently the government has promised the communities will be "net zero carbon", but "uncertainty persists on whether some element of carbon offsetting will be permitted" to achieve this goal.