Dalkia, owned by French energy giant EDF and Veolia Environmement, said it would build two biomass generators in Poland worth €70 million by 2012, in its largest-ever biomass project.

"Up to now this is the Dalkia Group's largest biomass combustion project," a Dalkia statement issued said.

"The investment of €70 million, which is to generate around €364 million in supplementary annual turnover, is a project which from 2012 will exceed the target of 15 per cent renewables fixed by Poland's energy policy and will prevent the emission of 460,000 tons of C02 emissions per year," the statement said.

Coal-rich Poland relies on the fossil fuel to generate some 90 per cent of its electricity and a substantial portion of its heat in plants dating predominantly from the communist era.

The two new electricity and heating plants, in Poznan, western Poland and the central industrial city of Lodz, will use some 700,000 tons of biomass as of the end of 2011.

The plants are to feed Poland's national electricity grid and provide heat for some 700,000 residents of the two cities.

According to experts, biomass energy plants fired by organic matter ranging from agricultural waste such as straw or manure to forest waste products can have C02 emissions up to 60 per cent lower than facilities using fossil fuels.