A $640 million natural gas-fired power station will go ahead in western Victoria.
Origin Energy announced it would proceed with the project at a site 12km west of Mortlake.
The 1000-megawatt plant will be the largest power station built in Victoria since the early 1990s, when the Loy Yang B coal-fired plant was built in the Latrobe Valley.
Energy and Resources Minister Peter Batchelor said 550 megawatts of power would be generated in the first stage of the project, boosting Victoria's electricity capacity by up to five per cent."
"The natural gas-fired power station will also generate cleaner energy - emitting up to 70 per cent less greenhouse gas than brown coal," he said.
"This project has the potential to add hundreds of millions of dollars to the economy and 200 jobs during the construction phase, particularly in Victoria's south-west region."
The project comes after the government this week signed off on a $750 million brown coal power station in the Latrobe Valley.
The 400 megawatt plant will use "clean coal" technology to produce electricity with 30 per cent less greenhouse emissions than conventional power stations.
