Hundreds of new jobs could be created following a government announcement to speed up private investment in power stations using renewable energy.
The firms will receive a guaranteed price for producing low-carbon energy.
The first projects to benefit are on Teesside and in Northumberland.
Lynemouth and the surrounding area was hit badly in 2012, when the former Alcan aluminium smelter was closed, with the loss of hundreds of jobs.
The power station next door, which employed 130 people and was sold to new owners, will be converted from coal to biomass.
Teesside Renewable Energy in Middlesbrough is also expected to press ahead with investment to produce biomass energy.
Berwick MP, Sir Alan Beith, says it is good news for Lynemouth.
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