The Sugar sector is one of the major focus areas that would play an important role in the future economy of Ethiopia, thus to hasten the development of the sugar industry the need for technologies is very crucial. The major barriers identified were lack of scheduled maintenance program, shortage of skilled labor, less focus given to research and development (RD) environmental and safety management. This thesis is a survey of already installed Wonji sugar cogeneration plants to review and propose an alternative option on the current situation and prospects for efficient, competitive, and environmentally-friendly electric production on the Wonji sugar factory on the application of cogeneration. The aim of this work is to assess opportunities for conserving wasted resources and implementing onsite energy conservation means. Most of the energies are utilized by the industries, causing the depletion of fossil fuels and increasing the fuel price to utilize the maximum available energy from the waste heat sources. This energy is conducted in the turbine exhaust of the sugar generation plant. From this study, determine the amount of heat energy is lost from the turbine exhaust and it condenses in the condenser. The turbine heat energy is converted to a cooling effect using a vapor absorption refrigeration system and to replace the vapor compression refrigeration system. From the study energy consumption and energy, saving in the term of energy and electricity is analyzed. Through data collection and analysis, it is found that the captive power plant has been wasting energy that can be used in renewable resource-based combined heat power systems. This approach reduces the total consumption of electrical power by as electricity is used to power the vapor compression refrigeration system. In the cogeneration plant,the boiler supply steam to the turbine generator generates steam at pressure and temperature according to the sugar factory manual. It is analyzed that, to meet demands imposed during operating modes of the cogeneration plant the turbo-alternator have been controlled by three modes which were observed as A, B and C. Defined mode A: factory “on” and Grid “on” when cogeneration plant and grid are running in parallel. This is made for normal operation in the factory. In this mode,the factory shall be operating for about per year. Mode B: factory “off” and Grid “on” when cogeneration plant in no working but turbo-alternators are running to export power to grid. The factory shall be operating in this mode for about per year. Mode C: factory “on” and Grid “off” when the factory is operating but the grid is “off” due to some reason turbo-alternator shall be running at reduced load during this mode. The factory shall be operating in this mode for about . per year. It is suggested the turbo-alternator shall be suitable for synchronizing with the grid diesel engine and another turbo-alternator in the future to avoid the idle running of the factory when the national grid is interrupted. Thus, for this thesis, became to know, the amount of driving electric energy saved nearly per year using the vapor absorption refrigeration.Replacing Vapor compression refrigeration system byvapor absorption refrigeration system the company can save and tones of bagasse per year.