Cardiff incinerator: Welsh government pledges £100m over 25 years.
A project to burn rubbish from homes and businesses across south Wales will receive more than £100m from the Welsh government.
The Prosiect Gwyrdd incinerator project in Cardiff will get a fixed sum of nearly £4.3m a year over its 25 years.
Supporters say the incinerator could generate enough energy for around 50,000 homes.
But opponents have mounted a legal challenged in an attempt to stop it from being built.
Five local councils have come together to reduce the amount of waste sent to landfill sites.
The Prosiect Gwyrdd scheme will deal with waste that cannot be recycled from Caerphilly, Cardiff, Monmouthshire, Newport and the Vale of Glamorgan.
Ministers say it will help reach a target to eliminate all waste for landfill by 2025.
Energy giant E.ON is in talks with Viridor, the company behind the plant, to convert 172,000 tonnes of burnt household rubbish into energy.
Protest groups have campaigned against the incinerator which is being built on the Trident Park site near Splott, Cardiff.
But the Welsh government says the plant will create 36 full-time jobs and will save the councils involved £500m over the next 25 years.
Natural Resources Minister Alun Davies said: "We are working hard to ensure that we prevent, minimise, reuse or recycle as much of our waste as possible.
"However, for the waste left over, it is far better to use it to create energy that can power our homes and businesses than to bury it in the ground.
"Sending our waste to landfill and leaving it to rot is no longer an option - it uses up our land and damages our environment."
Cardiff councillor Russell Goodway, chair of the project committee, said: "In the current challenging economic climate, this project shows the benefits of councils working together in partnership and benefitting from the financial support from the Welsh government.
"The project team can now work with Viridor to finalise the agreed terms with a view to signing the contract by the end of September."
The campaign group Cardiff Against the Incinerator has mounted a legal challenge in the High Court to stop the plant from going ahead.
Group chairman Robert Griffiths said: "Alternative technologies are available, much less dangerous, much less hazardous, much more job intensive and much more environmentally responsible.
"I'm pretty astonished to hear totals of £100m being bandied around."