At least three people have been killed and four are missing after a fire and explosion underground at a hydroelectric power plant in northern Italy on Tuesday, the local mayor said.

Italian utility group Enel (ENEI.MI), opens new tab confirmed that a fire had broken out on one of its transformers at its hydro power plant in Bargi, close to Bologna, in the early afternoon.

The fire brigade said earlier that an explosion had occurred around 3 p.m. (1300 GMT) at a dam on Lake Suviana, 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 people were missing, while three were "badly hurt" and taken to hospital.

He added that the initial indication was that the incident was probably caused by a defect in a turbine.

Enel has not commented on the cause. The company said the dam basin had not been damaged and that the plant was offline at the time of the incident so there was no impact on electricity supply.

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.