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Two more shortlisted bidders have dropped out of English Partnerships' (EP) flagship zero-carbon housing scheme at Peterborough, apparently because of concerns about the scheme's financial viability.

Half of the six shortlisted to build the 450 homes, which must meet the highest level of the UK government's Code for Sustainable Homes, have now pulled out.

Barratt, the first to go, has been followed by One Peterborough - a joint venture between Crest Nicholson, Bioregional Quintain and housing association Minister - and Galliford Try in collaboration with social housing provider Cross Key.

The project is one of several zero-carbon housing developments being fast-tracked as part of the Carbon Challenge run by English Partnerships on behalf of the communities department. The initiative challenges developers to demonstrate that sustainable homes can be combined with high-quality design and economic viability.

The shortlisted bidders had been asked to provide detailed bids by next month and a preferred bidder was due to be selected by the summer.

It is understood that the bidders may have been deterred by concerns about the scheme's financial viability, possibly in connection with clean-up costs for the 7ha site, which is owned by the Eastern England Development Agency and Peterborough city council.

In a statement, Crest said: 鈥淎fter careful consideration of the Peterborough Carbon Challenge brief, One Peterborough felt unable to deliver in accordance with the objectives of the scheme while maintaining an acceptable commercial position and have withdrawn from the competition.鈥�

Barratt had cited the 鈥渞esources鈥� needed for the project as a reason for dropping out of the scheme bidding process. It is already preferred bidder on EP's other Carbon Challenge scheme at Hanham Hall in Bristol.

The Peterborough development is intended to help regenerate the south bank of the River Nene as part of the billion-pound transformation of the city being led by urban regeneration company Opportunity Peterborough.