Tesco has been given the go ahead to build Britain’s first straw-powered, combined heat and power plant.

The plant will generate 5mw of electrical power – enough to run eight Tesco superstores – and is the latest step by Tesco in its efforts to half the carbon footprint of its estate by 2020.

Straw is a natural and renewable material and a by-product of local farming. When used for energy, it emits the same level of CO2 as it absorbs while growing, effectively making the energy produced carbon neutral.

The only waste from the process is ash, which can then be used by other industries or passed back to the local farmers to be used as fertiliser. Tesco has estimated that it will have recouped the plant’s£12 million set-up costs within six years.

Five suitable sites for the supermarket’s biomass fuel production have been identified and the first plant is being introduced at its Goole distribution centre.

A second small-scale biomass site at the Livingston distribution centre is awaiting planning permission.

Tesco has already made substantial investments in energy efficiency and low carbon technologies. In the past year, it has invested£86 million in relevant schemes and is working with planning authorities to build a number of wind turbines.