If the contract receives approval from Full Council at its meeting on May 15, the £750 million contract will see the building of the most modern recycling facilities in the eastern region at Waterbeach.
Donarbon plans to build a mechanical biological treatment (MBT) plant on its existing waste management park at Waterbeach. The new facility will include a visitor centre, to help with recycling education.
Additional facilities for the composting of kerbside collected kitchen and garden waste will also be provided under the new contract.
Cabinet member for environment and community services councillor John Reynolds said: Cambridgeshire has record breaking recycling rates but we can do better. We cannot carry on dumping rubbish that cant be recycled in landfill.
This new contract will be more environmentally friendly and cheaper than continuing to landfill and will see Cambridgeshire once again leading the way in waste management.