Secretary of State for Energy, Amber Rudd, has approved a second multifuel power station at Ferrybridge in West Yorkshire, England.
Development consent was given for the facility, which will burn fuel from refuse, industrial and commercial waste including wood, said operator Multifuel Energy Ltd.
The £300m plant is to create hundreds of jobs over a three-year build and should produce electricity for about 160,000 homes, according to a statement by the company.
The adjoining coal-fired Ferrybridge 'C' power plant is to close in March 2016.
The approved power station is expected to produce up to 90MW of electricity annually by burning 675,000 tonnes of waste that could have ended up in landfill.
It is to be built next to the newly-constructed Ferrybridge Multifuel 1 that stated operations earlier this year.
Multifuel Energy is a joint venture between power company SSE and and waste management company Wheelabrator Technologies.