Work is to begin later this year on a £30m hydro power scheme in Ross-shire.
SSE will begin construction on the 7.5MW Glasa hydro scheme near Ardoss.
It is thought the scheme will be able to supply power to 4,000 homes and will be the largest to be built in the UK for five years.
First Minister Alex Salmond welcomed the news on the 70th anniversary of the beginning of the industry in Scotland.
He said: "Hydro-electric and its role in producing energy is one of the greatest industrial success stories of post-war Scotland.
"Hydro drove not only industrial development but also immense social achievement – something which still rings true today as the Scottish Government continues to grow delivery of clean energy through renewables schemes for the 21st Century and also by retaining support for new conventional hydro schemes.
"The Scottish Government is determined to encourage new conventional hydro-power schemes where possible which is why we have gone a step further than the UK Government in retaining our original level of support while the UK has reduced support."
Jim Smith, SSE's Managing Director Renewables, added: "Scotland and SSE share a strong legacy of hydro-electric power and I am delighted to announce our investment in the Glasa scheme in what is the 70th anniversary year of large scale hydro development in Scotland.
"I believe that hydro still has an important role to play in the decarbonisation of our generation fleet and in providing a flexible and reliable source of electricity within a balanced energy mix."
(JP/CD)
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