North Lincolnshire Council has started the procurement stage for a major 25-year contract to handle the Isle’s residual waste.
The successful bidder will handle up to 50,000 tonnes of council waste that is currently landfilled each year.
The waste will be turned into electricity to power homes and businesses at a facility to be based in North Lincolnshire.
A one-year long procurement has now begun, with shortlisting of the most suitable companies to take place in July.
The council will award the contract to design, build and operate the facility by August 2014.
The new system for handling the area’s residual waste will be ready by April 2017.
Councillor Nigel Sherwood, cabinet member for highways and neighbourhood at the council, said: “This is a major contract that could be worth around £200m that will handle North Lincolnshire’s residual waste over the next 25 years. We cannot keep putting rubbish into holes in the ground; we must think of better ways to deal with it.
“Turning the waste into electricity will benefit residents and businesses and makes good economic sense.
This is a major opportunity for businesses.”