A £200 million renewable gasification power plant is to be built in Hull.
The 25MW Energy Works plant will generate electricity from domestic and commercial refuse-derived fuel.
It will provide power to the National Grid and local businesses and is expected to produce enough power for around 43,000 homes.
There will also be a pre-treatment facility built to deliver improved flexibility in feedstock handling.
It is expected to be operational by January 2018.
It will be the largest of its type in the UK and the first advanced gas power plant supported by the Government’s Contracts for Difference (CfD) arrangements, UK engineering firm Spencer claims.
CfDs aim to help stimulate investment in green energy developments to achieve carbon reduction targets.
Charlie Spencer Executive Chairman of Spencer Group said: “We are delighted to have reached financial close and to have agreed a contract for the construction of Energy Works, which will enable us to move into the delivery phase of this pioneering development.”