BEIJING - China will start building one of its largest hydropower plants on Sunday in the country's southwest, the Xinhua News Agency reported, almost a year behind an earlier schedule.

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About 88,900 local people would have to make way for the 6 gigawatt, $3.68 billion Xiangjiaba project, to be built on the lower reaches of the Jianshajiang River, a main tributary of Yangtze River, Xinhua on Thursday quoted project sources as saying.

China, wary of its mounting dependence on imported oil, is keen to boost energy to be generated from renewable sources.

Hydropower, which now makes up nearly a quarter of China's installed generation capacity, is designated as a key area for such development.

When completed in 2015, Xiangjiaba will generate about 31 billion kilowatt hours of electricity a year, Xinhua said.

Last December, China started constructing the Xiluodu project with 12.6 GW installed capacity, also along the Jianshajiang River and the second-largest after the behemoth 18.2 GW Three Gorges Project.