LONDON EDF won planning approval from energy secretary on Tuesday to build the country's first new nuclear station in almost 20 years.
The French company, which has dominated Britain's nuclear sector since taking over British Energy in 2009, plans to make its investment decision once it has reached agreement with the UK government on a guaranteed electricity price for the new project.
"The planning decision to give consent to Hinkley Point follows a rigorous examination from the Planning Inspectorate, and detailed analysis within my Department," Energy Secretary Edward Davey said in a written statement to parliament.
"I am confident that the planning decision I have made is robust, evidence-based, compatible with the Energy National Policy Statements and is in the best interests of the country," he said.
Britain's planning agency had recommended the project for approval in December.
Davey said that the multi-billion-pound project would generate enough electricity to power the equivalent of five million households, making it one of the largest power stations in Britain.
Vincent de Rivaz, chief executive of EDF's UK arm EDF Energy, called the approval "a huge achievement".
"The success of this pioneering project will kick start the new nuclear programme in the UK and is expected to lead to lower costs for successive UK nuclear plants," he said.
Yet de Rivaz warned that the project would only move forward if it could reach an agreement on a guaranteed electricity price for the new project.
"To make this opportunity a reality, we need to reach agreement on the Contract for Difference for Hinkley Point C. Intensive discussions with the Government are taking place and agreement is still possible," he said.
The confidential discussions are expected to conclude by the end of the month.
British industry groups welcomed the decision, while environmentalists criticised the move.
"This is a big step forward on a critical energy infrastructure scheme," said Katja Hall, chief policy director at Britain's business lobby group CBI.
"A balanced energy mix is essential in order to ensure secure, low-carbon and affordable supply in the future, and new nuclear is a key part of this."
Keith Allott, chief adviser on climate change at environmental group WWF said new nuclear power stations would come at a high cost to taxpayers and create new nuclear waste.
"Backing nuclear means shifting a huge liability to British taxpayers for the cost of building, electricity and crucially, dealing with the waste," he said.
Britain drew up a major energy infrastructure plan in 2010.
"This planned project adds to a number of new energy projects consented since May 2010, including wind farms and biomass and gas-fired power stations," Davey said.
It is "vital to get investment in new (energy) infrastructure to get the economy moving," he said.
Britain is counting on new nuclear power in its energy mix for future decades, unlike countries such as Germany or Switzerland which have decided to phase out nuclear power after Japan's Fukushima crisis.
The Hinkley Point C project in Somerset will house two European Pressurised Water Reactors (EPRs) with a combined installed capacity of 3,260 MW, adjacent to an existing nuclear station also run by the company.
EDF expects the project to generate 25,000 jobs during construction throughout the supply chain and 900 staff will be permanently employed during its 60 years of operations.
British utility Centrica dropped out of the project last month.
EDF said earlier this year it planned to start talks with China Guangdong Nuclear Power Corporation about becoming a partner in its UK nuclear building programme.
Britain's last nuclear power station was opened at Sizewell in Suffolk in 1995, after a seven-year construction period. EDF also plans to build two new EPRs there.
The French firm operates all but one of Britain's nine nuclear stations.
Japan's engineering conglomerate Hitachi also plans to build nuclear power stations in Britain, but is at an earlier stage of planning and approval than EDF.
(Editing by Anthony Barker and Jason Neely)