The team behind the city's fundraising pigs sculptures has brought home the bacon.

Some £200,000 was handed over for the Two Tunnels cycling scheme by the organisers of the King Bladud's Pigs Project, which saw more than 100 of the animals dotted around the city this summer.

The money came from the proceeds of an auction of the sculptures and will boost the coffers of the £1.8 million scheme to provide a route through two old rail tunnels and over Tucking Mill Viaduct to the south of Bath.

The scheme – spearheaded by Bristol environmental charity Sustrans – will turn a 2.5-mile stretch of disused railway line into a walking and cycling path linking Bath with Midford and beyond.

Last December, Sustrans' Connect2 package of green transport ideas won the Big Lottery Fund's £50 million TV vote.

Sustrans has pledged £1 million from the lottery grant to the Bath scheme, and Bath and North East Somerset Council has offered up to £400,000 over the next few years.

The authority has approved an initial grant of £200,000 and is "minded" to give the same sum between 2010 and 2012.

The donation from the pigs project has now halved the fundraising shortfall – leaving the last £200,000 to be found.

Pigs project manager Justin Braithwaite, who was supported by a dedicated team of artists and helpers, said: "It's been exciting to mount this public art event – we have proven that public art works in Bath and I hope it will lead the way for other such events in the future."

All the models were taken off the streets to be auctioned after their summer stint but some are now re-appearing after being bought.

The pigs project was the idea of former councillor Gitte Dawson.

She said: "It's been great working on such a fun popular art project and at the same time, it benefits my favourite project, the Two Tunnels scheme. The public response to both the pigs and the path has been tremendous and building work should now get under way without delay. "

Sustrans chief executive Malcolm Shepherd said: "The outstanding financial donation secured through the hard work of Gitte and her team has made a significant contribution to making the Two Tunnels scheme a reality. As number one attraction for visitors to the city this summer, King Bladud's Pigs have been a massive success and we anticipate that their legacy, the path, will also be a hit for visitors and locals alike."

With the majority of funding now in place, Sustrans and the council can sign an agreement to confirm their continued commitment to the project and appoint a project engineer. That person will draw up detailed designs to renovate the unused viaduct and open up the two long tunnels, of which one is just under a mile long.

It is expected that work to open the virtually flat route along the old Somerset and Dorset Railway line will begin early next year and be completed by 2012.

Over the next few years work will include replacing more than 14,000 bricks in the Tucking Mill Viaduct, building two new bridges across roads and renovating six bridges.

Frank Tompson, chair of the Two Tunnels Group and a volunteer ranger for Sustrans said: "I am delighted that we have now secured the majority of funding for this very important project and I look forward to the signing of the contract between the partners as this will give the green light for work to begin on the ground."