The Poolbeg Incinerator project in Dublin may be abandoned at a cost to the taxpayer of €96m.
Dublin City Manager Owen Keegan is due to present the council with a series of options after an EU investigation decides whether the public private partnership breaches EU rules on State aid and procurement.
Last night he said the project may be dropped even if it survives EU scrutiny.
The Irish Times Environment Correspondent Frank McDonald says the original plans for the incinerator will never materialise.
"There is a possibility that a much scaled-down incinerator may be built on the site, in which case all of the public money that's been shelled out so far won't have been wasted," he said.
"But in the meantime there are serious questions to ask about how we got ourselves into this bind of losing - effectively - nearly €100m on a project that has yet to materialise."
Green Party Leader Eamonn Ryan says Dublin City Council should not have signed the contract for the incinerator in the first place.