The latest twist in the troubled history of the listed structure emerged after Regalian, the quoted property developer, confirmed it was considering buying the whole 35-acre site.
Regalian, in partnership with Bovis, is understood to be on a shortlist of two selected by the Ministry of Defence to redevelop Chelsea Barracks, sited just over the River Thames from the power station.
In return for owning one of central London's most valuable pieces of real estate, the winning consortium has to find an alternative home for the Coldstream Guards.
Regalian's managing director, Lee Goldstone, confirmed that the power station would be a suitable site for the soldiers: "We would buy the site and have made provisions for it within our bid," he said.
To buy Battersea, Regalian would have to pay around pounds 80m. It would probably redevelop the remainder of the site as a residential area.
News of Regalian's interest comes as the development plan for Battersea of its current owner, Parkview International, appears to be unravelling. Parkview, owned by the Hong Kong-based Hwang family, plans a pounds 500m leisure complex featuring a 35-screen multiplex run by Warner Brothers, plus two hotels, a shopping mall, and other leisure facilities.
But the scheme has been delayed by a dispute with the National Grid, which owns a key parcel of land next to the station. National Grid raised its pounds 5m sale price last May and a spokeswoman said it had not heard from Parkview since then.
In addition, there are rumours that Warner is to pull out of the agreement, leaving the station without an anchor tenant to attract the 10 million visitors it needs yearly to be cost effective. A spokesman for Warner denied this but said: "If other opportunities south of the river emerge, we'll look at them closely."
Parkview bought the freehold of Battersea in 1996 from the receivers of John Broome, the man who developed Alton Towers. It paid the receivers a reported pounds 10m for the site and agreed to mop up Mr Broome's pounds 70m debts.
The station itself dates back to 1929. It was designed by Sir Giles Gilbert Scott, the man responsible for Waterloo Bridge and the red telephone box. It was one of the first examples of contemporary industrial architecture in England. In 1980, the station closed and has decayed ever since.
One of the most surreal incidents at Battersea occurred when a giant pink pig moored over the station to launch Pink Floyd's Animals broke free. Air traffic control warned planes of the threat of a flying pig.