Plans were announced in June to exempt small sites from part of the zero carbon commitment, which seeks to ensure that no carbon emissions are generated from the energy used to heat and light new homes from 2016.
The government is now holding a consultation on how this proposal could work in practice.
The consultation document said that the exemption should "not be cast too widely", adding that the government’s preferred option is to set the threshold at 10 units or fewer.
However, it said it remained "open-minded to a different threshold for the site size and would welcome further evidence to inform future decisions on the level at which the threshold should be set".
The consultation document also said the government recognised that there were risks to the proposals, including the danger that larger developments may be "artificially split" into a number of smaller sites.
But it added: "The risks could be managed in two ways. Firstly, the government could introduce criteria for a maximum floor space alongside the unit based criteria. An approach could be to set a maximum size of 1,000 square metres of floor space for a 10 unit development – so 100 square metres of floor space for every property captured by the site size set.
"Alternatively, a completely different approach to the exemption could be designed. It could be targeted at smaller developers themselves rather than smaller sites. A smaller developer could be based on the government’s definition of a small company, which is based on having 49 employees or less."
The consultation runs until 7 January 2015.
Next steps to zero carbon homes: small sites exemption can be read here.