The proposed village on a 67acre site adjacent to the town aims to develop energy efficiency systems capable of sustaining the 132 houses, shops and business enterprise units planned for the scheme. The eco village will share 4.1m in funding with homeowners in established rural developments in north Tipperary who can now apply for grants to install energy-efficient upgrades in their homes.

The funding is being provided under a new programme aimed at supporting local communities interested in developing sustainable, energy-efficient policies. North Tipperary County Council will administer the funds.

"It's a big fillip for us, " says eco village project coordinator, Seamus Hoyne. "It's recognition for the huge undertaking we're involved in. The money will allow us to consider even more advanced development than we would otherwise have been able to do."

Construction work at the eco village, where house sites are still available, started earlier this year.

"Right now the roads infrastructure, the district heating networks and the lighting networks are all being laid down.

Construction of the residential units is expected to begin by the middle of next year and the project should then be completed within four years."

The eco village's pioneering district heating system will be powered by state-of-the-art woodchip boilers and solar panels. Each home in the village will be metered to measure energy use, and the whole process will be closely monitored, so other communities can learn from the experience.

"We are delighted that an idea which was spawned by the creation of our eco village is leading to immediate practical benefits for the people of North Tipperary, " said Ronan Kennedy, chairperson of the eco village development company, Sustainable Projects Ireland Ltd.

"The grant-aiding of our wood- and solar-fuelled district heating system is also very welcome. It is an important part of our project."