China has begun to build its first straw power plant in Shanxian County, east China's Shandong Province, said the project's investor, China Biologic Power Group Ltd. (Hong Kong).

The plant, with an installed capacity of 25,000 kilowatts, is projected to generate 156 million kilowatt-hours of electricity per year.

The project has a total investment of about 223 million yuan (27.53 million US dollars) and is expected to start operation in June 2006.

Shanxian, a major producer of farm produce in Shandong Province, has an abundance of straw and crop stalks. They are usually burned beside the fields or on nearby highways, not only causing serious pollution to the environment but also posing a potential hazard to drivers and pedestrians.

However, the seemingly hard-to-deal-with straw can be turned into alternative to conventional fuels.

With the completion of the new power plant, 200,000 tons of crop stalks will be consumed yearly, saving some 100,000 tons of coal a year.

Additionally, ashes from burning the straw can be used in crop fields as fertilizers, experts said.

The plant, approved by the National Development and Reform Commission in March 2004, has brought in advanced technologies for disposing crop stalks from Denmark. It will be the first of its kind in China and help quench Shandong's power thirst.