Lockheed Martin, the U.S. defense giant, has announced plans to build a 10-megawatt generating plant that uses variations in ocean water temperatures to generate electricity. The plant will be built off the coast of southern China.

The technology is called ocean thermal energy conversion, or OTEC. According to report by the Reuters news service, the closed system uses a liquid, such as ammonia, that boils in a heat exchanger in the presence of warm ocean water to create steam and drive a turbine. Cold, deep-sea water is pumped through another heat exchanger to condense the ammonia vapor back into a liquid.

Dan Heller, a Lockheed Martin executive, said the plant will be the largest OTEC plant ever built. It will provide electricity for a new luxury resort on Hainan Island and is one of several plants in development by other countries and private companies around the world. Southern China is an “ideal” location for such a plant, the company said in an announcement about the deal.

Lockheed said the agreement, which was announced April 16, could lead to the development of plants generating as much as 100 MW of electricity.

Reignwood Group, the Thai developer that signed the deal, said the new resort would be a net-zero energy development.

Although OTEC sounds exotic, even futuristic, the U.S. Department of Energy says it was first proposed more than 130 years ago by a French physicist named Jacques Arsene d’Arsonval. The first OTEC plant, constructed in Cuba in 1930, was able to produce 22 kW of electricity.