KUALA LUMPUR, Malaysia >> Malaysia has scrapped plans to build a coal-fired power plant near a Borneo wildlife reserve, a move environmentalists praised Thursday as a landmark effort to curtail projects that threaten rain forests teeming with endangered animals.

Musa Aman, the chief minister of Sabah state, announced Wednesday that the federal government had decided not to construct the 300-megawatt coal plant, which many feared would be a major source of pollution.

The $560 million plant would have been built on the site of an oil palm plantation, about 12 miles rom the Tabin Wildlife Reserve, home to Borneo pygmy elephants, rhinoceros and orangutans.

“Sabah needs to increase its power supply to meet the increasing development, but the state cannot afford to put its natural environment at risk,” Musa was quoted as saying in The Star newspaper.

Officials would seek other ways to fulfill Sabah’s energy demand, which is expected to increase by up to 8 percent annually, Musa said. He did not elaborate.

Authorities had planned to start construction of the plant in mid-2011, but the project stalled after it failed to obtain official approval from the government’s Department of Environment.

Conservationists have long criticized authorities in Malaysia’s two states in Borneo — Sabah and Sarawak — for building dams and other power projects that displaced thousands of indigenous people and destroyed large tracts of jungle.

Green Surf, a coalition of conservation groups that include the World Wildlife Fund, welcomed the latest decision.

“For us, this certainly marks a sea change. It’s the first step in doing things in a different way,” Green Surf representative Cynthia Ong said. “This is the best news for the planet.”

Green Surf would try to work with authorities to develop sources for clean energy, such as palm oil waste material, Ong said. Many residents in Sabah had also voiced objections to the proposed plant.