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The station is part of the nation's move away from an over-reliance on coal and will see the Huaxing Power Co. invest 2.5 billion yuan ($US304 million) in the construction of two 300 megawatt gas-fired generators in the Yangtze delta province of Jiangsu.
A spokesman for Zhangjiagang-based Huaxing Power Co said the first generator would produce power in August of 2005 and the second generator in February of 2006.
The power station will consume 700 million cubic metres of natural gas each year, which will come from the country's west via a 4,000km pipeline currently being built by state-controlled oil and gas company PetroChina.
The plant is the first of 10 gas-fired power plants China plans to build in the east for PetroChina's West-East gas project.
Five of the plants are planned for Jiangsu province while the other five plants will be in Shanghai city, Anhui province and Henan province.
The 20 billion yuan project will generate total generating capacity of 6,600 megawatts.
