German energy company RWE received approval from the Scottish government to build a 3-megawatt hydroelectric power station driven by the fresh water of Loch Arkaig.
The plant will power around 1,600 households when it goes into service within the next 18 months, the energy company said.
Olaf Heil, the head of hydropower projects at renewables division RWE Innogy, said small-scale projects like the Loch Arkaig facility are ecological compatible with sustainable energy goals.
"Especially along smaller rivers, power plants of roughly this size conserve both the landscape and ecosystems," he said.
The German company has 19 hydroelectric plants in the United Kingdom, 12 of which are in Scotland.
The company last week started work on a 3.5 MW project fueled by the River Glass. The River Glass facility will generate enough power for around 2,000 households.