The developers of a project that will use cold ocean water to provide air conditioning for downtown Honolulu said today they have received a permit from the state that will allow them to begin construction in the Kakaako area.

The awarding of a Special Management Area use Approval and Shoreline Setback Variance to Honolulu Seawater Air Conditioning LLC is a “major milestone” for the project, said William Mahlum, HSWAC president and chief executive officer.

The SMA permit system provides guidance through State law for managing coastal development and allows HSWAC to construct a pumping and cooling station, as well as install underground piping in the Kakaako area.

Groundbreaking is expected in the first half of 2012 and construction is projected to be completed sometime in 2013.