The £65m plant will process 1.6 billion bottles, pots, tubs and trays annually and be powered by electricity produced by a £252m rubbish burning plant presently under construction at the site near Bristol.
Viridor is aiming to help stem plastic waste exports and create a true circular economy energy park.
Two-thirds of plastic collected for recycling in the UK are presently exported but many recipient country’s like Malaysia are now turning away plastic waste.
Parent company Pennon’s chief executive officer Chris Loughlin said: “By using waste which cannot be recycled as the fuel to create low carbon electricity which will power plastics recycling we are creating a truly resource and energy-efficient waste management solution.
“There is a clear ambition from both UK consumers and politicians to improve recycling rates and reduce the amount of waste which is sent to export.
“Our research shows that 80% of people believe the UK should find a way to deal with its own recycling without having to ship it to other countries.
“Unless action is taken now and investment in infrastructure is made, a plastic recycling capacity gap will undermine UK ambitions and the sustainability targets of retailers and the big consumer brands.”