The waste burning power plant facility will be built at Oxwellmains and will generate enough energy to power 39,000 homes.
Martin Grey, communications manager for Viridor, said: “As Scotland’s largest recycler, Viridor is investing up to £800m in Scottish ‘next generation’ infrastructure to help the public and private sectors meet ambitious targets and avoid exposure to costly landfill levies.
“This includes plans for a £200m energy from waste hub on a rail linked landfill site at Oxwellmains where Viridor has been treating the city’s waste for the past thirteen years.”
By 2025 the Scottish government is aiming for 70% of waste to be recycled and just 5% to be sent to landfill.
Up to 150 construction jobs and 47 skilled and professional positions are to be created by the new facility.
The energy from waste plant also has the potential to save taxpayers £165,000 each year through a reduction in exposure to land fill levies.