Bord na Mona has sold the distribution rights to the electricity produced at Drehid for €50.
The €50m will be paid over the course of 15 years in a Power Purchase Agreement (PPA) deal.
The electricity produced by burning methane that naturally emanates from the landfill at Drehid, near Allenwood.
The plant was launched at Drehid some months ago and generates enough electricity to power the equivalent of 14,000 homes.
It has an annual production of 5.6 megawatts of renewable electricity from gas that is continually produced from the decomposition of waste in the landfill site.
“Bord na Móna has invested heavily in new and innovative ways of capitalising on all our resources to create further value and uses,” said Bord na Mona’s John Daly.
“This is the result of a transformation in the way we look at spent materials, turning household waste into green energy that in turn helps create jobs and a sustainable electricity supply.”
Meanwhile Vayu’s Colm Kennedy saw it as helping to achieve the Government’s target of 40% renewable generation by 2020.
“We see enormous potential for renewable schemes such as this to transform the way electricity is produced in Ireland.