Dominion Virginia Power has received approval from the Virginia State Corporation Commission (SCC) for its $1.3bn combined cycle power station in Greensville County.
The proposed 1,588MW natural gas-fired power station is being built as part of the company's plan to meet air quality and proposed carbon dioxide emissions standards, while serving the growing demand for energy.
Construction will begin later this year, with plans to bring the power plant online in 2019.
During construction, the facility will create more than 1,000 jobs, in addition to 45 full-time positions that will be created when it enters operation.
Dominion Generation Group CEO Paul Koonce said: "This project will ultimately bring low-cost, reliable electricity to our customers, while saving them $2bn over the life of the plants' operation, in addition to providing a major economic impact and good paying jobs for Southside Virginia."
The project is being built just a few miles from Dominion's Brunswick Power Station, which is expected to be fully operational next month.
The station will have low-carbon intensity as it uses clean-burning natural gas, combined cycle technology, and best available control technology to reduce emissions.
It will also use less water, minimising the impact to rivers and streams.
Development and construction of the project will contribute close to $474m to the Commonwealth.
Dominion currently has a portfolio of approximately 24,300MW of generation and 6,500 miles of electric transmission lines.
The company also operates one of the nation's largest natural gas storage systems with 933 billion cubic feet of storage capacity.