What we're left with is a deeply confusing situation where apparently identical houses can have completely different building standards - purely based on whether they happen to be part of a ten-home or 15-home estate.
Today's ministers are stuck with an inaccurate label for their 'zero carbon homes' - policy, and privately admit that 'zero carbon' has become something of a misnomer.
The scheme, first dreamt up in the dying days of the New Labour government, has only survived thanks to the Liberal Democrat presence in government.
Now, The Ecologist can reveal, the coalition's parties are scrapping once again over the latest bid to water the idea down - for a second time.
And it's important - as from 2016 all new homes in the UK need to qualify as zero carbon. The EU Energy Performance of Buildings Directive also requires all new buildings to be nearly Zero Energy Buildings from 2020.
The first serious dilution came last June when the Queen's speech included measures to allow developers to 'offset' some of the carbon emissions from the homes they build, by buying in carbon credits from elsewhere.
This undermined the zero-carbon concept, said critics, as it created a loophole for developers to build to a less stringent standard, while buyers would no longer enjoy the very low to nonexistent energy bills they might expect.
Now, it's even worse
The current frontline is over the government's plans to exempt developers in England working on smaller sites of ten houses or fewer from having to meet parts, or even all of the zero carbon standard.
One proposal being consulted on would exempt developers of such homes from having to offset the impact of their homes' carbon footprint via the 'allowable solutions' provision.
But of even greater concern is an idea to exempt developers from having to meet the FEES 'fabric performance' standard. It's not clear in the consultation if they would have to meet a lower energy standard - or even no standard at all.
About 20% of all new homes are expected to be covered by this provision, but it could be even more.
If Conservatives within the Department for Communities and Local Government find the majority of responses to the consultation suggest the rate of house-building could be slowed as a result, they will seek to use that as ammunition to increase the threshold from ten homes to 15, or even 20.
So it's up to green-minded housebuilders to make their views clear to ministers and ensure the zero carbon homes project isn't undermined any further.
Critics say the bold ambition of the zero carbon policy has slowly faded over the years.
Originally the vision was a comprehensive one: that from 2016, all new homes would be completely carbon-neutral. Everything - from the electricity used by hairdryers and televisions to the construction materials used to build it - was to be included. The homes' energy needs would be balanced by on-site generation from solar panels or other renewable energy.
The coalition quickly abandoned that principle. It wasn't practical, they said. 'Zero carbon' was stripped back so that it only covered the universal uses of energy in homes: heating, lighting, etc.
Nick Schoon, policy manager at sustainability charity Bioregional, says this was the first of several disappointing setbacks: "It sends a bad signal if you have any kind of ambitious policy which says 'we're setting out to do this', and then as the years goes by you start pulling back from various bits of it."
And that is exactly what has happened.
Thin end of the wedge
And then came the 'offsetting' plan, set out in the Queen's Speech under the bland title of 'allowable solutions'. The logic behind it was simple: it wouldn't ever be possible for every home to achieve onsite power generation, so in some cases exceptions had to be made.
These 'allowable solutions' would see developers pay into schemes that would preferably improve energy efficiency in the neighbourhood or, failing that, contribute to the government's green investment bank.
The original insistence on onsite generation is one of the most divisive aspects of the zero carbon policy, as comments by the Tory 'green peer' Lord Deben (the former John Gummer) reveal.
"The green movement went on and on about onsite generation," the chair of the Committee on Climate Change complains. "They've got a hang-up about non-distributive energy. But the much bigger argument is how much energy you use.
"If you have a very good insulated home, they don't need much electricity. The idea that you have to generate it onsite is barmy. But because it got into the system, it meant that it had to come out. I blame that."
Under the new policy, as set out on Zero Carbon Hub, there are three core requirements which must all be met for a home to qualify as 'zero carbon':
- The fabric performance must, at a minimum, comply with the defined standard known as the Fabric Energy Efficiency Standard (FEES) and
- Any CO2 emissions that remain after consideration of heating, cooling, fixed lighting and ventilation, must be less than or equal to the Carbon Compliance limit established for zero carbon homes, and
- Any remaining CO2 emissions, from regulated energy sources (after requirements 1 and 2 have been met), must be reduced to zero.
Requirement 3 may be met by either deliberately 'over performing' on requirements 1 and 2 so that there are no remaining emissions, or by investing in Allowable Solutions.
The housing debate gets in the way
But the further retreat from the original 'zero carbon' concept is the most dangerous of all, as it would create a two-tier system - in which smaller-scale developments could get away with both a lower 'fabric performance' and exemption from the 'allowable solutions' requirement.
Ministers' big preoccupation driving this change is the housing supply - and the awareness that to meet its house-building targets, many developments will have to go ahead on small sites.
But the viability of these developments is threatened by the shaky state of the builders who will have do the work. In 1986 there were more than 12,000 small and medium-sized enterprises building homes. Nowadays that number is estimated at around 2,700.
Exempting them from the 'allowable solutions' requirement woudl give them a simple cash boost. But many smaller builders may also lack the technical skills to achieve the FEES standard, and struggle to find construction workers with the necessary attention to detail.
The government's response was painfully inevitable. Facing the short-term political pressure of high house prices, ministers put the long-term imperative of cutting carbon emissions to one side.
Louise Sunderland, senior sustainability adviser at the UK Green Building Council, sums up the problem like this: "As the policy has developed it's starting to look a lot more like a disincentive for innovation, and a little bit like a tax." She adds the the prospect of exemption from the energy perforamce standard is "very worrying indeed".
"The implication is a home on a larger site would have to be built to a higher standard in fabric than those on a smaller site," Sunderland adds. "The fact they're consulting on it means it is a policy option. That's really dangerous - there just seems to be no justification for it."
What we're left with is a "deeply confusing situation" where apparently identical houses can have completely different building standards - purely based on whether they happen to be part of a ten-home or 15-home estate.
And wherever the division between large and small-site developments eventually falls, it means sacrificing the simplicity of a straightforward, uniform set of building regulations. That creates a danger that large housebuilders could look for loopholes to break their larger developments into smaller pieces.
So much for innovation
Across the sustainability there is a lot of sympathy for DCLG minister Stephen Williams, who as the Lib Dem in charge of the policy has had to fight off successive attacks from sceptical Tories.
Despite everything, the 2016 rollout of code four building regulations is likely to result in an approximate 20% improvement in the carbon footprint of new homes.
That is progress, but it is only one step on a journey - not the endpoint suggested by the 'zero carbon' tag. What this policy was supposed to do, above all else, was create an environment where builders could innovate to reduce the costs of cutting carbon emissions.
This is what Lord Deben means when he says the small-sites exemption is "nonsensical". Asked about the difficulties of developing small sites, he is adamant: "That's to miss the point! It isn't more difficult! It's only more difficult if you pretend it's more difficult. That's not the issue!
"If you really think that, then why not offer a one per cent reduction in stamp duty for any set of houses less than ten? In most cases the extra cost is so minimal when compared with every other extra cost that this is a ridiculous thing to look at."
It's worse than that: getting new build designs to become the mainstream and developing new technologies to get the cost down are essential. But if a big part of the stock is built to different designs, requiring different technologies and materials, the supply chain is divided and progress is hindered.
"We'll actually be a fair way off what the industry can achieve, particularly on the renewable technology side," Sunderland says sadly. "It's really quite regrettable."
Beyond zero carbon
2016 will come and go. The Climate Change Act will continue to motivate future governments to look to further carbon emissions reductions. Somehow, they will have to find ways to reduce the impact of homes still further.
Nick Schoon of Bioregional thinks a big step will be taking carbon out of the materials used in the fabric of buildings. Concrete is a carbon-intensive material, for example - could increased use of sustainable timber become a viable large-scale alternative? Then there is the electricity being used in homes which isn't covered by the new rules at all.
"We need a commitment for complete decarbonisation of the electricity grid", he says. "What we've had is another worrying signal about the government's overall commitment to reducing greenhouse gas emissions by 80% by 2050 from their 1990 level."
As sustainability advocates fight to minimise the damage to zero carbon homes, they can't be blamed for doubting whether these limited reforms are really going to be enough to achieve the change Britain - and the planet - urgently needs.
The consultation paper: 'Next steps to zero carbon homes: small sites exemption'. Consultaion closes on 7th January 2015, 11.45 am.
Alex Stevenson is parliamentary editor of politics.co.uk, and a regular contributor to The Ecologist.
More information on zero carbon homes: Zero Carbon Hub.