Planning has been approved to FCC Environment for the development of the plant at Millerhill in Midlothian.
The 25-year contract involves the thermal treatment of up to 135,000 tonnes of mixed waste to produce electricity for the National Grid.
FCC Medio Ambiente SA was appointed preferred bidder in December 2014 to design, build, finance and operate facilities to treat and recover value from the waste collected by City of Edinburgh and Midlothian Councils.
-- Advertisement --
Heat will also be produced for a district heating scheme, with less than 5% of waste going to landfills in line with government targets.
Zero Waste: Edinburgh and Midlothian is a joint project between the authority's to deliver dedicated facilities for the treatment of food and residual waste they collect.
Councillor Lesley Hinds said: "This decision takes us a step closer to our goal of achieving the highest possible public participation in recycling while having dedicated, competitively priced facilities that will use all the remaining waste that cannot be readily recovered as a valuable resource."
"In combination with the food waste treatment plant which is nearing completion, these facilities will boost our recycling rate, guarantee we would meet our landfill diversion targets and make a significant contribution towards Scotland's renewable energy targets."
Gordon Pollock, Zero Waste Project Director, added: "Our project team is working up the details of the agreement with the aim of the partner councils signing the contract with FCC in December."
(LM)
