Pursuant to the contract, the company and its subcontractors will develop and operate the power plant for ten years and have an option to extend the agreement for five additional years.

Hyperion, which is claimed to be the tenth largest wastewater treatment facilities in the world, generates a class 1 renewable fuel known as digester gas, which will be used as a primary fuel source by the co-generation facility.

Once operational by the end of 2016, the power plant, which is estimated to cost around $130m, will generate steam and electricity that will power Hyperion’s treatment operations.

L.A. Sanitation COO Traci Minamide said, "This state-of-the-art facility will reduce emissions at the Hyperion plant and secure for our city a new energy source that is reliable, efficient and sustainable."

Constellation senior vice president, energy management programs Gary Fromer said the company has been selected to develop and operate the integrated, self-sustaining solution for the city of Los Angeles and L.A. Sanitation.

"Our objective is to deliver and operate for the city a power plant that will become a nationwide model for reliable, cost-efficient, sustainable power solutions at wastewater treatment facilities," added Fromer.