Dockhead and Old Kent Road fire stations are to be rebuilt as part of a £57.4 million private finance initiative (PFI) project.
The PFI project – which was first announced in 2006 – will see London Fire Brigade receive £57.4 million to rebuild nine fire stations: Dagenham, Dockhead, Leytonstone, Mitcham, Old Kent Road, Orpington, Plaistow, Purley and Shadwell.
Now the Government has approved the package of works proposed by London Fire Brigade.
Construction work is expected to start in 2012 once detailed plans have been approved.
"I am pleased that we've been given the go-ahead to build nine new fire stations," says London Fire Commissioner Ron Dobson.
"They will be an important contribution to providing modern facilities for our firefighters."
Southwark councillors gave the go-ahead for the demolition of the 1920s Dockhead fire station in Wolseley Street in April despite criticisms of the "truly awful" design of the proposed replacement fire station.
The existing building – which the fire brigade says is too small for modern vehicles – featured extensively in the ITV drama series 'London's Burning'.
The station building work will be phased so that temporary cover arrangements for affected stations can be put into place.
Under a PFI scheme a capital project such as a new fire station is designed, built, financed and operated by a private sector consortium under a contract that typically lasts for 30 years. The process to select a consortium to develop the nine new fire stations will begin in July.