Iberdrola Renovables has begun building its first forestry biomass power plant in the US, which will have a capacity of 26.8MW.
Lakeview cogeneration plant is due to be commissioned by the end of 2012.
Located in Oregan, the plant will generate electricity from forestry biomass to be obtained from cleaning and pruning operations in the state's southern and eastern forests.
The plant will be located within a short distance from major transmission lines and will reduce water use in its facility by over 80%.
The project will enable Iberdrola Renovables to enter the biomass business in the US as part of its policy of investing in non-wind technologies.