Forth Energy hopes to build the 100 megawatt power station, which would burn up to 1.5 million tonnes of wood fuel each year, but it has attracted 986 letters of objection.
Environment groups argue the large-scale biomass plant would not be sustainable as it would burn vast quantities of wood, leading to deforestation.
They say the public inquiry is crucial because it will be the first biomass inquiry in the UK to examine sustainability.
On plans to burn 1.5 million tonnes of wood each year, Walter Attwood, a Friends of the Earth Stirling activist, said: “This is not sustainable and will bring about serious environmental degradation, adverse climate change and, in some places in the world, the growing of this type of fuel will also have adverse social effects.”
The inquiry, at the Grange Manor Hotel in Grangemouth, is expected to finish on 31 May.