Construction work is expected to begin later this year after it was awarded planning consent by the Secretary of State in October 2015.
The project will be developed next to the recently completed FM1 project, on land at Ferrybridge 'C' Power Station in Knottingley.
The completed plant will be able to generate around 70MW of electricity, enough to power around 170,000 homes.
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An EPC contract has been signed with Hitachi Zosen Inova (HZI), a Swiss headquartered company who are a market leader in building energy from waste projects, who were also the main EPC contractor on the neighbouring FM1 plant.
Charlie Cryans, Head of Construction for SSE said: "SSE's decision to take the FM2 project through to construction is positive for our businesses, but also represents a £360 million investment, which will provide a range of benefits for the local area which we have a long association with. We will be holding a Meet the Buyer event in the coming weeks which will provide local businesses and suppliers with the opportunity to meet the main contractor for the project, and pitch their products and services."
(CD/MH)
