Wandsworth has an opportunity “never seen in its history” after plans for a new US embassy at Nine Elms were approved, in principal, by Wandsworth Council last night.

Outline planning permission for the five acre development in Battersea was granted by the council’s planning applications committee, and work could begin as soon as next year.

The remaining stumbling blocks to the application appears to be two fold - how much the US should contribute to extending the Northern line to the area, and the building’s design, including concerns over height and an intrusive security wall.

The US ambassador in London, Louis Susman, said the council’s decision ”recognised the positive role the new embassy will play in the regeneration of Nine Elms”, while Wandsworth Council leader, Edward Lister, said the green light would open the area in north east Battersea - which is bigger than Canary Wharf - to an opportunity “Wandsworth has never seen in its history” .

Plans for the borough’s iconic Battersea Power Station (BPS) and the redevelopment of the New Covent Garden Market are expected to come before the council in the next 18 months.

Coun Lister said: “This [the embassy] is a very important development and a very exciting one. This is the first development for the Nine Elms opportunity area and will create many support jobs.”

Boris Johnson, the Mayor of London, has asked London developers to help fund to the £16bn Crossrail project, but Coun Lister said there were strong “indications” the Mayor would allow Crossrail money to be diverted to fund the Northern line extension into Battersea from Vauxhall.

Currently the US has agreed to pay £640,000 towards any scheme, but the Mayor wants the US to pay £2.5m.

The embassy building will be a maximum 97 metres tall, but will have to preserve existing views of the Palace of Westminster.

The building’s design, which is subject to a competition involving US architects, will be chosen at the end of the year.

About 800 people will work in the embassy, but many more jobs are expected to be created in the service sectors needed to maintain the building and its employees.

The council’s planning applications chairman, Councillor Leslie McDonnell, said the scheme would “kick-start regeneration of the area” and the building would be a benchmark for the area in terms of design and sustainability.

The embassy will be in the centre of its site, surrounded by a perimeter wall 30 metres away.

The project will now go to for approval to the Mayor of London, who has already expressed his desire that the security wall does not make the site too unwelcoming to visitors and those viewing the site from the Thames.

Other improvements to the area include linking the site to Vauxhall improvements to the riverside walk, a new park and increased cycle and pedestrian access.

The embassy announced it was moving from its Grosvenor Square site last year citing problems with space and security.