The 28.9-billion-yuan (3.7-billion-dollars) Xiangjiaba project, in southwest China's Sichuan province, will have six million kilowatt of installed capacity when completed in nine years, the China Daily said.

When combined with the 12.6 million kilowatt Xiluodu project, started further downstream 11 months ago, it will be the equivalent of the 18.2 million kilowatt Three Gorges Project, the largest hydro project in China.

"The project will have to face manifold challenges, including environmental protection and resettlement of residents," said Fan Qixiang, the vice-president of China Three Gorges Project Corp, the builder of the project.

The company will earmark 1.46 billion yuan for environment protection, Fan added.

Nearly 90,000 residents from six counties in Sichuan and the neighboring province of Yunnan will be forced to leave their homes because of the project, the report said.

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