A residual waste treatment facility will be built by Shanks after it signed the £750 million, 25-year contract with Wakefield.
The PFI deal, that also included funding from the Green Investment Bank, will see Shanks build the facility to treat 230,000 tonnes of residual solid waste.
Materials will be separated for recycling with the rest turned into refuse derived fuel. This fuel will then be sent to a multi-fuel plant being built at the Ferrybridge Power Station for energy recovery.
A separate materials recycling facility on the same site will sort material for recycling.
Any remaining organic waste will be treated using an autoclave before being fed into a 65,000 tonnes per annum anaerobic digestion plant, to generate biogas.
Shanks Group chief executive Peter Dilnot said: “We are delighted to have signed this contract with Wakefield Council and look forward to working with the authority and local residents to increase their diversion from landill. Our solution will help it make more from the waste it produces by increasing recycling, generating green energy and producing compost for land remediation and use by residents.
“We are excited that the Green Investment Bank has chosen this project as one of its first major investments, which will see Shanks draw on experience from across our group to deliver a genuinely sustainable solution.”
Wakefield Council chief executive Joanne Roney added: “It has been a long journey and at times challenging, but throughout the negotiations we have never lost sight of the need for additional finance to deliver a waste management system for the future.
“I am very pleased that this 25-year contract has now been signed and we can move on to concentrate on the job of improving waste and recycling services for everyone in the district and protecting the environment. I look forward to working with Shanks and to seeing the new waste management plans come to fruition.”