Construction has begun on the first of eight large hydro stations planned for the middle and lower reaches of the Lancang river in Yunnan Province, southwest China. With a designed generating capacity of 42MW, the Xiaowan plant is expected to cost US$.71B. It will be the second largest hydro station in China, after the Three Gorges, when it is completed in 2012.

Xiaowan will have a 292m high dam. The electricity produced will be sent to the coastal province of Guangdong, south China.

The total installed capacity of all eight of the plants planned for the Lancang river will be 155MW.