The plant's planners still must clear several hurdles including obtaining a federal draft air permit, making power purchase agreements with utilities, and completing an environmental impact statement.

Power from Desert Rock, planned to be built near Ship Rock in northwestern New Mexico would supply cities in the state as well as Nevada and Arizona.

Sithe Global said the plant is expected to use technologies that will cut emissions of mercury and smog components sulfur dioxide and nitrogen oxide. Mercury can damage the nervous system and kidneys, as well as other pollutants.

"This plant will have all the bells and whistles," said Frank Maisano, a spokesman for the company, said in an interview.

Environmental groups such as the Dooda Desert Rock Committee have been fighting the plant saying that it would hurt air quality and use large qualities of water.

Maisano said the plant would use "dry cooled" technology which would cut the amount of water it needs.

The plant would be located at the mouth of a low-sulfur coal mine called the Navajo Mine.