The City and County of Swansea has approved TEG Environmental's plans for the provision of its Silo-Cage in-vessel composting system.
Won in a competitive tender, the contract will involve the design and construction of the composter for the authority.
City and Council of Swansea cabinet member for the environment John Hague said: "We are pleased to be implementing leading, green-edge technology, which can deal with the growing problem of safely treating organic waste streams to the high standards required by legislation and helping us meet the statutory targets for diverting waste from landfill."
Wales' second city should beat Cardiff to being home to the first in-vessel composter in the country. The Welsh capital hit the headlines when it asked its residents to not recycle their tea bags over foot and mouth concerns until it built its own technology to deal with green waste.