Supermarket giant Tesco has said all its carrier bags will be degradable from September.
Tesco will replace conventional plastic bags with degradable ones
The bags break down in as little as 60 days into materials such as carbon dioxide and water with no harmful residue, unlike plastic bags.
The firm hopes a billion fewer plastic bags a year will be used in a bid for it to be more environmentally-friendly.
The Co-op first introduced degradable bags in 2002 and Sainsbury's have trialled compostable bags.
Tesco chief executive Sir Terry Leahy announced the measure as part of a 10-point plan, which include halving Tesco stores' energy use by 2010 compared with the year 2000.
But Liberal Democrat environment spokesman Chris Huhne said he would rather see a tax on plastic bags introduced.
"Biodegradable plastic bags in themselves can have an adverse environmental impact by creating greenhouse gases within landfill sites.
"The government should look again at introducing some form of plastic bag tax which will make supermarkets and consumers think twice before they give away and use plastic bags in the first place."
The company has also pledged to reduce deliveries to its local Express convenience stores to cut congestion.
It aims to double the amount of material customers return to stores for recycling by 2008.
Addressing the Work Foundation think tank, Sir Terry urged the government to back its plans by allowing developments to go ahead.
"Much of this new sustainable technology, for example wind turbines at our stores, requires planning permission", he said.
Tesco first introduced degradable bags in its stores two years ago.
It estimates 719 million degradable carrier bags have since been used by customers, saving the equivalent of 6,035 tonnes of non-degradable plastic.