At least three people lost their lives and four others are missing after a fire and blast rocked a hydroelectric power plant in northern Italy on Tuesday.

Italian utility group Enel said that a fire had broken out on one of its transformers at its hydropower plant in Bargi, close to Bologna in the early afternoon.

The fire brigade said earlier that an explosion had occurred around 3:00 p.m. (1300 GMT) at a dam on Lake Suviana which is one of three artificial lakes that feed the power station.

Marco Masinara, the mayor of the nearby town of Camugnano said three dead bodies had been found and four were missing, while three were "badly hurt" and had been taken to hospital.

He added that the numbers were "being updated."

Enel said it had evacuated workers from the site and was coordinating with rescue workers from the fire department.

Masinara said a fire broke out below ground level, adding that "the plant is all below the level of the lake, at about 30 meters' depth."

He told Italy's Ansa news agency that initial information suggested that work was being done on a turbine at the time of the accident.

"I have been told that the fire brigade are trying to get access but are having difficulties," he added.

Video supplied by firefighters showed thick smoke rising up from the plant.

The deaths are likely to fuel concerns expressed by trade unions about workplace safety in Italy. Two of the country's largest unions were already due to hold a four-hour nationwide strike on Thursday to protest over the issue.

In a high profile accident in February, five workers were killed and three seriously injured while building a supermarket in the city of Florence.

Enel said it had evacuated workers from the Bargi site and was coordinating with rescue workers from the fire department.

Masinara said flames erupted below ground level, adding that "the plant is all below the level of the lake, at about 30 metres' depth".

He told Italy's Ansa news agency that initial information suggested that work was being done on a turbine at the time of the accident. "I have been told that the fire brigade are trying to get access but are having difficulties," Masinara added.