Adama is one of the fastest growing towns with an increasing solid waste generation rate. The collection and disposal of solid waste is a persistent problem to the city with no proposed solution to tackle this problem. Currently, solid waste generated per day in the city of Adama is estimated to be 190 tones/day. In this thesis, the city’s waste was taken as a case study to identify the characteristics of the waste and assess the possibility of implementing energy recovery options focusing on incineration plant to generate electrical energy. In order to achieve that, Data and sample waste is collected from the Adama city and other relevant research works, waste composition and characterization was performed. Based on the achieved data an incineration-based power plant was designed using Thermoflex application tool. The validation of the design and the software tool was checked using an existing power plant design with its data. For optimization of the plant parameters such as the moisture content and ash content of the waste, the heat value of the waste, the flue gas temperature, the steam condensation pressure and the steam turbine temperature were analyzed. Results showed using 70% of MSW from Adama city that it would be possible to generate above 12.5MW power at an efficiency of about 22.5%. Such a power plant would be able to supply about 1136 households yearly (11kw/hr/household) generating around 1,3million USD yearly income while needing an initial capital investment of around 10,4 million USD. This initial investment can be returned at a return rate of 11.87% within 16 years.