Australia yesterday announced it would build one of the world's biggest solar power plants amid warnings of blackouts unless it can increase generation to meet the growing demand for air conditioners.

With climate change being increasingly blamed for the severe drought that has been affecting parts of the continent for six years, and with cities imposing punishing water restrictions, the government has begun to support alternative forms of energy.

The new plant, expected to be built in Victoria by Solar Systems Generation, is expected to be a solar concentrator, an emerging technology that collects sun rays in hundreds of square metres of curved mirrors, then beams the concentrated heat on to photovoltaic panels.

The 154-megawatt project, which will be heavily subsidised by federal and state grants, will be able to provide power for 45,000 homes and could produce temperatures as high as 1,000C (1,832F). Similar solar power stations are now being built in the US and many Mediterranean countries, and it is likely that Australia's proposed plant will be nowhere near the largest in the world by the time it is officially completed in 2013. A Spanish solar power station using similar technology is expected to produce 354MW of solar power within a year.