The Site C Clean Energy Project has been given the green light from Christy Clark's B.C. government.
The premier made the announcement in Victoria, saying it is an investment in the future of the province for decades.
"This decision today really does come down to people and I believe in the people of B.C., I believe in the future of B.C., I believe the British Columbians will continue to succeed and our economy will continue to grow, long after this announcement is over," Clark said.
The project will put a third dam and hydroelectric generating station on the Peace River in northeast B.C.
According to BC Hydro, Site C would provide 1,100 megawatts (MW) of capacity, and produce about 5,100 gigawatt hours (GWh) of electricity each year — enough energy to power the equivalent of about 450,000 homes per year in B.C.
The Site C project received environmental approvals from the federal and provincial governments in October.
The environmental assessment process began in 2011 and included multiple years of studies to identify and assess potential project effects and develop comprehensive mitigation measures.
"The real work starts today and we have a lot of work ahead of us," Clark said in closing.