MW Power, a Metso-Wärtsilä joint venture, will deliver a steam boiler plant to Valio's Lapinlahti production plants in Finland.
The contract value has not been disclosed.
The delivery includes all necessary installations, the commissioning and the Metso DNA automation system.
The facility will generate the steam and heat needed by Valio's Lapinlahti milk processing plant and will be fuelled by locally sourced, wood-based biomass.
The biomass-fired plant is scheduled to be completed in 2013.
Valio technical manager Esa Mäkipelto said: "Valio is investing in the development of its energy generation structure and in the recovery of waste energy streams with the goal of improving energy efficiency, achieving lower emissions and increasing its use of domestic fuels. The use of domestic fuels will also benefit other players in the area."