City Council in Saskatoon has approved the final step towards a multi-million dollar project to collect methane gas from Saskatoon's landfill and convert that into electricity.

When organic waste decomposes, methane gas is produced.

Saskatoon hopes to capture that gas and use it as fuel for a power plant.

Kevin Hudson, manager of metering and sustainable electricity with Saskatoon Light & Power, says the project is one way to reduce harmful greenhouse gases.

"With the gas that we're capturing, it's equivalent to reducing our emissions by about 45 thousand tons annually," Hudson explained. "That's like removing about nine thousand vehicles from our roadways."

On Monday, Saskatoon city council gave the OK for officials to sell the power generated by the project to the province's electricity Crown corporation, SaskPower. The contract would run for 20 years. By then, according to the city, the overall project will have made a return to Saskatoon of $8.4 million after taking into account the cost of building the system.

The city estimates it will sell about $1 million worth of electricity in its first full year of production, expected in 2014.

According to Hudson, in many jurisdictions in North America, landfills are required to manage landfill gas so it is not released into the atmosphere.

Different experience in Regina

Regina embarked on a landfill gas project in 2007 when it installed a system to collect methane gas.

Three years later, however, the city scaled back its plan after a potential partner was not able to make the project economically feasible.

At the time, the city said it would simply flare off the methane gas it collected.

With files from CBC's David Shield