* New plant to replace four oldest units at Rybnik
* Environment rules require closure of oldest plants by 2016
* Construction to take six years
* Alstom's share of the contract worth 900 million euros (Adds Alstom contract details, share price)
By Caroline Jacobs and Elena Berton
PARIS, Dec 5 (Reuters) - French power utility EDF plans to invest 1.8 billion euros ($2.4 billion) building a coal-fired power plant in Poland, where electricity demand is rising about 3 percent annually and old inefficient plants need to be shut down.
The project involves replacing the four oldest units at the Rybnik plant in southern Poland with a single, more efficient one, EDF said on Monday, adding it would take six years and about 2,000 people will work on its construction.
The type of plant being built in Poland operates at higher temperatures than regular coal-fired power plants, which raises pressure and, in turn, efficiency, increasing the amount of power output and decreasing carbon dioxide emissions.
EDF said CO2 emissions at the plant would be 30 percent lower than at traditional coal units.
EDF has previously said it would diversify its nuclear-dominated portfolio by building strong businesses in gas and coal, as well as hydropower and renewables.
It also plans to increase the share of its power production capacity abroad, reducing its exposure to government-set power rates in its domestic French market.
"This investment decision is in line with the group's ambition to reinforce its positions in Central Europe and target 200 gigawatts of installed capacity by 2020, with a diversified energy mix, made up of 25 percent of fossil-fired energy," EDF said.
EDF has a 10 percent share of the electricity market and a 20 percent share of the district heating market in Poland. Power generating companies owned by EDF in Poland principally use coal as fuel.
French engineering company Alstom won a 900 million-euro contract to supply the power generation equipment for the plant, which will be fired by hard coal and biomass.
This deal further strengthens Alstom's power generation business as some European countries reconsider their investment in nuclear power.
"With the exit of Germany from nuclear power, its neighbours will be compelled to look at alternative energy. This could be positive for Alstom, which is not well placed in Germany," said Kepler Capital Markets analyst Pierre Boucheny.
Alstom shares were up 2.8 percent at 26.38 euros at 0935 GMT, outperforming a 0.8 percent firmer CAC 40 index. EDF was trading 0.7 percent higher at 20.025 euros.
($1 = 0.7446 euro) (Additional reporting by Juliette Rouillon; Editing by James Regan and Jane Merriman)
