Construction work is to start immediately.
The ETF is the UK's financial commitment to tackling climate change within the UK and developing countries.
GWE Biogas is one of five preferred projects selected by the programme and will receive a p
roportion of the £10 million available within the 'Anaerobic Digestion Demonstration Programme', designed to help the UK deliver an increase in the generation of renewable energy, a reduction in waste sent to landfill and a reduction in greenhouse gas emissions.
The programme is being delivered by WRAP (Waste Resources Action Programme) with support from the Carbon Trust.
Financial support for the project follows planning permission recently granted to the company by East Riding of Yorkshire Council to build an AD facility for converting food waste to energy.
Construction works will be carried out by local contractors.
Designed to produce green electricity from some 50,000 tonnes of food waste received on site each year via local authorities, food producers, manufacturers and supermarkets, Driffield-based GWE Biogas has been established by local businessmen and farmers, Tom Megginson and Mathew Girking.
Situated on a Greenfield site, the fully licensed facility will produce sufficient electricity to supply full power to more than 2,000 homes or light 15,000 houses locally, as well as sufficient output to either heat some 400 homes or provide heat to businesses on the nearby Kelleythorpe Industrial Estate.
The by-product of the process will be a safe, odourless bio-fertiliser to displace manufactured chemical fertilisers currently used on the company's associated farmland.
In addition, state-of-the-art equipment employed by GWE Biogas will innovatively de-package food stuffs, recycling the redundant materials and extracting organic material for processing that would otherwise have gone to landfill or incineration.
It is anticipated that the facility will save the equivalent of 28,340 tonne of carbon emissions annually, equal to taking 11,800 cars off the road.
"With 30% of the food that we buy ending up in the bin, making use of what we throw away and diverting food waste from landfill is becoming more critical than ever," said Mathew Girking, director, GWE.
"Our proposed scheme will not only produce local green energy and bio-fertilisers that will be of great benefit to local agriculture and businesses, but will also create 15 much needed jobs for Driffield."
He added: "AD is the Government's preferred method of food waste disposal and is a completely sealed process from start to finish. We are confident therefore that the plant will have minimal impact on the surroundings and unlike composting, which has become synonymous with odours in the East Riding, our new facility will be odourless through the use of advanced bio-filters and all plant being contained within one building. It's a win, win situation for all concerned and we are very excited about the business's prospects and the beneficial knock-on effects for Driffield."
A proposed educational resource centre to teach pupils from local schools and colleges about the benefits of recycling and AD technology and the alternative routes for waste disposal is proposed once the site is open. "Eastburn Farm has a long track record of helping educate children and is really keen to build on that platform by explaining to youngsters the importance of making the most of our natural resources. This initiative will therefore complement the existing school visits to Eastburn Farm each May," pointed out Mr Girking.
