Viridor has been chosen as preferred bidder to deliver an energy from waste facility in Peterborough.
The city council said that the plant, to be built in the industrial area of Fengate, would cut landfill by more than 93%.
Viridor beat Kier to win the contract to build the facility by 2015.
The plant will generate around 53,000 megawatt hours of electricity to power local homes and the National Grid.
Peterborough produces around 90,000 tonnes of waste per year, which is set to increase to 140,000 tonnes by 2040. Currently, 43% is recycled, with the remaining 50,000 tonnes of waste sent to landfill.
Matthew Lee, deputy leader of Peterborough City Council, said: “This contract heralds a whole new, and very exciting, approach to the way in which we manage our waste. We have been very fortunate to have two excellent proposals from the two final bidders. I will now consider the recommendation carefully before making my decision.”