The Environmental Protection Agency has granted a licence to the Irish Cement company to burn tyres and other types of solid waste at its plant in Mungret in Co Limerick.
The company had initiated a €10 million plan to burn this type of waste at high heat to enable it to move away from using fossil fuels at the plant, and to secure its future where 80 people are employed.
They claimed the burning of these solid fuels at such high temperatures would have a negligible impact on the environment.
The plan had been vigorously opposed by local groups in the area, which is a large suburban area on the outskirts of Limerick City.
The 'Limerick Against Pollution' group - which has lead a strong campaign to fight the plans and which organised a protest march in the city last year - said they are extremely disappointed at the news.
The group said it intends to continue to fight the decision and will bring their campaign to Europe.
Chair of the group, Clare Keating, said they were "absolutely devastated" at the decision.
"We had lead a campaign for the past four years fighting these plans, and over 4,000 objections had been lodged opposing the plans," she said.
The decision to grant the licence is subject to appeal, which must be lodged over the next 28 days.
LAP says they will appeal the decision in the first instance, and will be seeking an oral hearing.
They also intend on appealing to the petitions committee of the EU to continue their opposition.