THE £600mTees Renewable Energy Plant has received crucial European Commission approval.

The factory will be built at Teesport, between Redcar and Middlesbrough, and will be one of the world’s largest biomass power stations, providing electricity for 600,000 homes.

Operated by MGT Teesside, a subsidiary of MGT Power, it is understood the plant will burn wood chips and pellets imported from the US, with heat generated also going to industrial and commercial customers.

The factory should start sending power to the National Grid by 2019 and will create 150 permanent jobs. It will also support at least 600 construction jobs and 450 supply chain roles.

The company last year signed with the Department of Energy and Climate Change (DECC) to guarantee a fixed price for electricity for 15 years, which the European Commission has now approved.

Ben Elsworth, MGT Power’s chief executive, said: “This was the final regulatory hurdle to progressing the project, and we will now proceed as quickly as possible to begin construction.

"This was a long period of uncertainty, but we were always extremely confident we complied with all the applicable rules, and are relieved and excited to be able to finally move into the next stage.”

Edward Davey, DECC secretary, said the Teesside site would be crucial to the UK’s future energy needs.

He said: “Teesside is now well placed to be a major hub in the green economy. Renewable electricity generation has been booming across the UK, and we are seeing record levels of renewable investment.

"By bringing together combined heat and power and biomass, the plant will create and support hundreds of jobs while cutting Britain’s carbon emissions.”"