Energy Secretary Ed Davey has given the go-ahead for the first of a planned new generation of nuclear power plants in the UK.
Davey told MPs that he was granting planning consent for French energy giant EDF to construct a new nuclear power station at Hinkley Point C, in Somerset.
The news is a boost to the nuclear industry following a series of setbacks in plans to construct a new fleet of reactors in the UK, which ministers say are needed to cut carbon and keep the lights on.
Davey told the Commons that affordable new nuclear would play a "crucial role" in ensuring secure, diverse supplies of energy in the UK and decarbonising the electricity sector and the economy.
The plant's two nuclear reactors would be capable of producing 7 per cent of the UK's electricity, enough to power five million homes, EDF has said.
It is thought the costs of the new power station would run to around £14 billion.
A final investment decision by EDF to go ahead with construction still depends on the deal being negotiated with the government on the "strike" price paid for electricity generated by the plant.
Under electricity market reforms, low-carbon power such as nuclear reactors and offshore wind farms will have long-term contracts with a guaranteed price for their electricity, to give investors certainty to invest in projects with high capital costs.
Davey said discussions on the strike price were ongoing, but he expected them to be concluded shortly.
The decision to grant a development consent order is in addition to a separate process of health and safety assessment, with permits awarded by the Office for Nuclear Regulation and the Environment Agency.
Davey said EDF had now secured the majority of consents it needed to build and operate the plant.
Gary Smith, national officer of the GMB union, described today's planning consent as a "welcome and necessary step forward".
But he said: "However the delay in agreeing the price to be paid for electricity to be generated in the fleet of nuclear power stations we need is very damaging for investment, jobs and for a low-carbon economy in the UK.
"Earlier this month, the Energy and Climate Change Committee called on ministers to urgently come up with a contingency plan in case the nuclear industry does not deliver the new power stations we need.
"The state is required to guarantee the levels of returns on investment for electricity suppliers. Since this is so, why not go the whole hog and have a fully accountable nationalised delivery body particularly in the nuclear sector."
Davey said: "It's vital to get investment in new infrastructure to get the economy moving. Low-carbon energy projects will bring major investment, supporting jobs and driving growth.
"This planned project adds to a number of new energy projects consented since May 2010, including wind farms and biomass and gas-fired power stations.
"This planned new nuclear power station in Somerset will generate vast amounts of clean energy and enhance our energy security.
"It will benefit the local economy, through direct employment, the supply chain and the use of local services."
Hinkley Point C, which will be operated by EDF subsidiary NNB Generation, will be the first new nuclear power plant in the UK since Sizewell B, which started generating electricity in 1995.
It is estimated the project will create between 20,000 and 25,000 jobs during construction and 900 permanent jobs once in operation.
Business group CBI's chief policy director Katja Hall said the planning permission for the new reactors was a big step forward on a critical energy infrastructure scheme.
"Major projects like this not only help us to overcome our energy challenges, but provide a real boost to growth, creating thousands of jobs directly and through the supply chain.
"A balanced energy mix is essential in order to ensure secure, low-carbon and affordable supply in the future, and new nuclear is a key part of this."
But environmental groups reacted angrily to the news that the new reactors were given the go-ahead.
They raised concerns over the potentially high strike price for electricity the government will agree to in order to get the nuclear plant built, and over the issue of nuclear waste.
Keith Allott, chief adviser on climate change at WWF-UK, said: "Backing nuclear means shifting a huge liability to British taxpayers for the cost of building, electricity and crucially, dealing with the waste.
"Unlike renewable energy, the costs of nuclear keep on rising - as witnessed by the fact that the only reactors currently being built in Europe are massively over-budget and far behind schedule.
"Focusing on renewables and energy efficiency, on the other hand, where the UK has huge potential to be an industrial leader, could deliver both huge cost reductions and a substantial boost to UK economic growth and manufacturing."
And Greenpeace executive director John Sauven said Hinkley Point C failed the test on economic, consumer, environmental and arguably even legal grounds.
"It will lock a generation of consumers into higher energy bills, via a strike price that's expected to be double the current price of electricity, and it will distort energy policy by displacing newer, cleaner, cheaper technologies.
"With companies now saying the price of offshore wind will drop so much it will be on par with nuclear by 2020, there is no rationale for allowing Hinkley C to proceed.
"Giving it the green light when there is no credible plan for dealing with the waste could also be in breach of the law," he warned.
Somerset County Council welcomed today's decision, which it said would see £100 million a year going into the regional economy at the peak of the eight-year construction project.
David Hall, Somerset County Council's deputy leader, said: "The Hinkley Point C project will unlock tremendous opportunities for Somerset, including thousands of new jobs, supply chain investment and a large number of apprenticeships for our young people.
"The proposals have a come a long way, and we are ready and waiting for the 'go' so we can help make the project a reality and reap the rewards for the county."
Duncan McGinty, leader of Sedgemoor District Council, said: "The decision heralds significant opportunities as well as challenges over the coming decade and we are ready to work hard to see that the full benefits are felt locally and to try to keep disruption of daily lives to a minimum.
But he said: "However, we now ask that the government turns its attention to the needs of these communities in Sedgemoor and west Somerset.
"It must ensure that they receive fair, reasonable, and proportionate benefits in recognition of the burden of hosting a power station which will deliver great benefits to the nation but whose significant impact is felt locally."
Dr Tim Fox, head of Energy and Environment at the Institution of Mechanical Engineers said: “Although anticipated for months, the planning permission approved today is a welcome step on the way to the building of new nuclear power plants in the UK.
“However, the more important, and still uncertain step, will be for the government to agree a 'strike price' – or a guaranteed future electricity price – for the power generated by the Hinkley Point C plant.
"It will need to be sufficiently attractive to investors from at home and outside of the UK for the plant to go ahead.
"Also, crucially, this price needs to be acceptable to the public when considered alongside strike prices agreed for electricity from renewables and other low carbon sources of power.
“We are transforming the energy system for the 21st century and effectively at a start-up for new nuclear, so getting this balance right for the first plant is key to helping ensure future success with follow on projects.
“Hopefully a deal will be reached between the government and EDF soon so that we will be able to make a start on the big engineering challenges ahead.
"The scale and complexity of the engineering required to build a nuclear power plant will require a highly capable workforce led by skilled engineers and project managers.
"More needs to be done to increase the number of people choosing engineering as a career to overcome a skills shortage.
"Over the next 10 years, the UK needs to be recruiting about 87,000 engineers a year but worryingly we are currently producing just 46,000 engineers a year.
“There is also the issue of nuclear waste as the government is yet to make significant steps forward in developing the Geological Disposal Facility for long term storage or in addressing the UK's stockpile of Plutonium.”