The 12-month project will allow the plant to provide around 18,000 megawatt hours of electricity a year for use by Symex at Port Melbourne and its wholly-owned subsidiary Pental Products at Shepparton.

The remaining 15,000MWh will be available for export to the Victorian power grid. It will be enough to supply around 3700 average households with their annual electricity needs.

The cogeneration facility will consist of a low emissions gas turbine/electricity generator set and a waste heat recovery low pressure steam boiler.

Steam will be generated by utilising the high temperature exhaust heat of the gas turbine, significantly increasing its fuel efficiency compared to a conventional power plant.

This will reduce carbon dioxide emissions by up to 22,000 tonnes a year, the equivalent of taking around 5,000 standard cars off the road for a year.

Symex chairman Alan Stockdale said the 15-year agreement with AGL provides Symex with a predictability about its long-term energy expenses.

"It gives us a low risk of volatility in our energy costs through to 2020 and will provide very low energy costs and an environmentally efficient outcome," he said.

AGL will build and operate the new plant, and provide financial backing for the project, said managing director Greg Martin.

“AGL has already utilised this technology successfully at Coopers Brewery in South Australia and welcomes the opportunity to work with a major industrial company to produce a win-win solution for business, the environment and customers,” Martin said.