Construction has begun on an ambitious canal-side housing project in London’s East End with its own source of energy.

The £26 million Watts Grove development next to the Limehouse Cut is to be decked with rooftop solar energy panels, thought to be the local authority’s first purpose-built low-cost rental housing scheme with its own sustainable source of electric power.

The Tower Hamlets council scheme in Bow Common has 148 new, ‘affordable’ dwellings, part paid-for with a £6.9m ‘gift’ from Boris Johnson’s housing fund at City Hall.

It is part of a strategy for low-cost housing to relieve overcrowding and cut the East End’s waiting list, the longest in London, with 20,000 families queuing for properties.

Overcrowding is now at 23 per cent in the Bromley South ward where Watts Grove is located.

“This development will help to alleviate the housing situation,” Tower Hamlets’ new mayor John Biggs said. “People in the area have expressed again and again that they need more housing.

“Watts Grove will be exactly what they have been demanding.”

Labour inherited the scheme for low-rent homes from the previous independent administration of deposed mayor Lutfur Rahman. But the new mayor now wants to “examine further just how ‘affordable’ they are”.

Watts Grove is a ‘brownfield’ site, which had been a functioning depot for the council’s street-cleansing operations run by its contractors, Veolia. The depot has been moved to other sites in the borough.

The development has 13 houses and 135 flats in four blocks of five and seven storeys, a total of 565 rooms.

Around 45 per cent are suitable for families in a mix of three and four bedroom properties, while 10 per cent of the units are also accessible by wheelchair.