Work on the controversial Poolbeg incinerator has finally begun despite continued opposition from locals and city councillors.
The €600m facility, which will have the capacity to burn 600,000 tonnes of waste a year, is expected to be open in 2017.
Private US energy company Covanta has now arrived at the site in Dublin.
The move to forge ahead with the project was made by city manager Owen Keegan in consultation with the chief executives of Dublin's four local authorities.
The project has been dogged by financial, legal and political hurdles in the past seven years.
Local opponents say the plant is too big and are now planning legal action.
The Combined Residents Against Incineration will also lead a march to Leinster House tomorrow in protest.
But Covanta's head of European development, Matthew Mulcahy, has said the plant will operate within its permissions, divert waste away from landfill, and would generate energy to supply up to 80,000 homes.
The move to start construction comes despite vehement opposition from Dublin city councillors, who, according to Councillor Dermot Lacey, have voted against this on at least 30 occasions.
"It's too big. It's in the wrong place. It's going to attract too much traffic," he said.
"I've no idea what the traffic plan is for the area. I've no idea of how it's going to interact with the local community."
Green Party leader Eamon Ryan said it was a "disgrace" that the contract had been signed.
"This sets us on a course for 50 years which is incredibly expensive and which we don't need," he said.
Some €100m has been spent by the Dublin local authorities on the project, including €52m for the site, now worth an estimated €6m.
More than €30m of Covanta's total investment has already been spent on development costs and pre-construction activities.
The project agreement will cover 45 years of facility operations, after which ownership will revert to Dublin.
The European Commission ruled last May that the project was not in breach of State aid rules. That decision meant the incinerator was cleared for construction.
Planning permission for the project had originally been granted in 2007, but it has been beset by a number of delays and other problems.