Homes in the village of Winlaton in Gateshead are set to become the first on the UK's gas network to use hydrogen gas for cooking and heating.
670 homes will take part in a pilot project, which will see 20 per cent hydrogen blended with natural gas. Construction work has begun and the supply is expected to be ready for use in the Spring.
More than 80 per cent of homes in the UK are heated by natural gas, which emits carbon dioxide. Hydrogen only releases water and carbon when burnt.
The Winlaton pilot is being seen as a test case in the battle to reduce the household emissions.
Tim Harwood, programme director at gas distributors Northern Gas Networks, said the company had "been around each house and talked to all the occupants and explained exactly what we're doing."
The ten month pilot is led by Northern Gas Networks and the energy company Cadent, in partnership with the Health & Safety Executive.
In November the prime minister set out his ten point plan for a green industrial revolution.
Boris Johnson said his government planned to invest in enough hydrogen capacity to power 1.5 million homes by 2030, and develop the first hydrogen-heated town by the end of the decade.