Nuclear power is needed to help reduce carbon emissions and to ensure that the UK has secure energy supplies in the future, the prime minister has said.
"We are not going to be able to make up through wind farms all the deficit on nuclear power," Tony Blair told MPs.
The government's Energy White Paper has backed renewable energy and efficiency measures - but said the "preliminary view" supports more nuclear plants.
Critics said more nuclear power could be a "dirty white elephant".
They also said a new consultation launched on the merits of nuclear power was a "farce".
Industry Secretary Alistair Darling told MPs a decision on nuclear power was needed by the end of the year because many nuclear and coal-fired power stations were due to close within 20 years.
Other key points include:
Free "real time" displays given on request to show homeowners how much electricity they are using.
Working with industry to "phase out" inefficient goods such as energy-consuming standby switches.
Tougher environmental standards for new build homes, and other products.
Consultation launched on possible sites for new nuclear plants - based on assumption environmental impact is not "significantly different" to other forms of energy generation.
Triple the amount of electricity from renewable sources such as wind and wave by 2015.
Set up the world's first carbon trading scheme for large organisations such as banks and government departments.
Encourage mining of UK coal where it is economically and environmentally appropriate to reduce reliance on exports.
Mr Darling said the measures outlined could save between 22 million and 33 million tonnes of carbon emissions by 2020.
He said he wanted British industry to be at the forefront of new, green technologies, but added: "We can't become a low carbon economy in a single step."
The government had reached a preliminary view that it would be in the public interest to allow energy companies to invest in nuclear power, he said.
But, although the work done to identify possible site, he said no final decision would be made until the consultation ends in October.
However, Lib Dem trade and industry spokeswoman Susan Kramer said: "This consultation is a total farce. Ministers have clearly already decided to back nuclear."
Before the statement was published, Mr Blair told MPs at prime minister's questions: "If we want to have secure energy supplies and reduce CO2 emissions, we have got to put the issue of nuclear power on the agenda."
Lib Dem leader Sir Menzies Campbell had accused him of appearing to "disregard the issue of risk and cost and toxic waste" and asked for more investment in renewable energy and "clean coal technology".
The planning process for power stations is set to be streamlined by changes outlined on Monday.
And Chancellor Gordon Brown - who will take over as prime minister in June - is also thought to back building more nuclear power stations.
The White Paper was to be published in March, but the government was told to consult again after a legal challenge by environmental campaign group Greenpeace.
The Lib Dems, and some environmental groups, said that allowing new nuclear power stations to be built would draw investment away from renewable energy and other "green technologies" - like carbon capture.
Friends of the Earth's Roger Higman told the BBC: "The fear we have is that by investing in nuclear, we will invest in a dangerous, dirty white elephant."
For the Green Party, Caroline Lucas said: "By prioritising the construction of new nuclear power stations over reducing demand for energy ... the government is not only missing a trick, it is undermining efforts to tackle climate change."
Shadow trade and industry secretary Alan Duncan said: "Whatever the rhetoric, there is nothing in this White Paper that will guarantee that a single nuclear power station will be built."
"Business will only invest in nuclear power if it knows its costs - it needs certainty about carbon, decommissioning, and waste."
The Tories are in favour of nuclear power as a last resort but oppose subsidies or price guarantees for nuclear firms.