PLANS for a £350 million oil-fired power station on the Isle of Grain, near Rochester, have been given the green light.

The Department of Trade and Industry has backed the controversial proposal to build the E.ON UK complex on its existing site at Grain.

Construction could begin next year, with electricity generation expected to start in 2009.

E.ON UK, the company that runs Powergen, welcomed the decision, saying the 1,200 megawatt power station would reduce emissions by producing electricity at the "highest level of efficiency seen in the UK to date."

Dr Paul Golby, chief executive of E.ON UK, said: "This new station will help us to bridge the gap between the UK’s existing capacity and the generators of the future, helping to both keep the lights on for our homes and businesses and also ensuring a reduction in emissions.

"And it is only by looking at a mix of new power projects such as this, alongside advanced supercritical coal, clean coal and renewable technologies that we can help the UK ensure diversity of fuel supply, and so security of power supply, for decades to come.

"Our aim is to change the way we generate and use electricity in the UK and, to that end, we’ve committed to reducing the carbon intensity of our generation by 10 per cent by 2012.

"We’ve already reduced its carbon intensity by 20 per cent since 1990."

Earlier this month, E.ON UK announced £1 billion plans to build two new 800MW plants at its Kingsnorth coal-fired power station. It claims the investment will see a reduction in carbon emissions of almost two million tonnes a year.

The company also has around 1,300MW of renewable projects in various states of development, including the £1.5bn London Array wind farm scheme.

E.ON UK is a partner in a consortium hoping to put 271 wind turbines in the Thames Estuary and a sub-station at Graveney, near Faversham.