The project is a joint venture between Lockheed and a Taiwanese research institute to build a 10-megawatt plant that is estimated to be enough to power about 3,000 homes.

"As island economies in the Pacific, Taiwan and the state of Hawaii share very similar challenges of overdependence on imported petroleum for their energy needs," Hawaii Gov. Linda Lingle said.

Bethesda, Md.-based Lockheed Martin said it has been studying ocean thermal energy conversion technology for more than 30 years. The technology produces energy by using the difference in temperature between warm water at the surface and colder water deeper in the sea.

A feasibility study is currently under way, conducted by the Taiwanese Research Institute.