The building of Britain's largest biomass plant took a step forward after the granting of a licence by Environment Agency Wales (EAW).
The £400m plant in Port Talbot will be able to power 500,000 homes and produce electricity with lower carbon emissions using material such as wood chip.
The permit will legally bind developers Prenergy Power to emission limits and health and environmental standards.
A campaign group said it was concerned the emission limits could not be met.
Biomass plants use biological material such as wood chip to generate power.
Plans for the Prenergy plant near the deep water harbour in Port Talbot were approved by the UK government in November 2007 and the licence from EAW is necessary for it to operate.
As a condition of the plant's permit, the agency has insisted that all the wood used is from sustainable sources.
EAW said the Prenegy plant will produce electricity with 50% to 80% fewer greenhouse gas emissions than gas or coal-fired power stations and is expected to be operating early in 2011.
But concerns have been raised by people in Port Talbot about the impact such a plant would have on air quality and local health.
Port Talbot Residents Against Power Stations (PTRAPS) said that changes made since the draft decision in 2007 supported its claim that emissions of a harmful chemical benzo[a] pyrenes were too high.
"The EAW have now set the limit according to the more stringent UK limit," PTRAPS said in a statement.
"This means that Prenergy Power now have to meet an emission limit 60 times lower than that set in the draft decision.
"We are concerned, however, that this licence sets limits that, by the admission of the developer, cannot be met.
"What we fear is that the power station will be built, that these stringent limits will be exceeded, and that the EAW will not be in a position to regulate them.
"Once built and operational it is difficult to imagine it being closed down or sufficiently restricted with regards excessive emissions. That will mean that the health of the people of Port Talbot will be harmed.
"We are still of the opinion that this licence should have been refused."
Prenergy Power have been asked for comment.
EAW said its decision followed evaluation and discussions with residents and the local health board.
It set emission limits to protect health in the area, it said.
Steve Brown, EAW area manager, said the permit was designed to ensure the continued protection of people and the local environment.
"We have carried out a thorough and detailed assessment of all aspects of the permit application from Prenergy.
"We have considered the impacts on air quality and people's health as well as the local environment whilst assessing this application.
"We are confident that this power station meets the requirements of the current regulations governing its operation and that a permit can be issued." | 
What we fear is that the power station will be built, that these stringent limits will be exceeded, and that the EAW will not be in a position to regulate them 
