Developer Rolton Kilbride has secured permission for a facility on an industrial estate in South Marston.
According to the firm, the scheme would have a capacity to generate up to 14.5 megawatts of electricity and 1.5 megawatts of heat from 150,000 tonnes of waste every year.
The plans faced opposition from local residents, including the Stop the Keypoint Incinerator Project (SKIP) campaign group, and were originally rejected by Swindon Borough Council in September 2017.
Inspector Melvyn Middleton advised that another site allocated for an energy from waste facility in the Swindon local plan was no longer available after planning permission was granted for a school on the land in question.
In the absence of local policies for energy from waste facilities on unallocated sites, the inspector noted that an industrial or employment area was the council’s stated preferred location for waste management facilities.
He judged that road accessibility for the appeal site was comparable to the site originally allocated and found that a nearby rail siding would also be beneficial.
The inspector accepted the need for more local waste recovery capacity and found the proposed facility would divert local commercial and industrial waste away from landfill and reduce the need to transport waste to west London or southern Europe.
Permission was granted subject to conditions including an improved air filtration system in order to safeguard a nearby Oxford University library storage facility, which was considered by the inspector to be a non-designated heritage asset.
A spokeswoman for the developer said: "We welcome the inspector’s conclusion. We understand that councils have a difficult job in making these decisions and balancing different points of view.
"There exists a large amount of misinformation regarding energy from waste facilities. This appeal has shone a light on some of these myths.
"Rolton Kilbride want to be a good and considerate neighbour and have worked with the Bodleian Library to address their concerns. We have said, from the outset of the process, that we are committed to working with the community, and that remains the case."
In a statement, the SKIP campaign group said: "This does not necessarily mean that the development will go ahead - just that Rolton Kilbride now have planning permission.
"They still have particular conditions to meet - in particular showing that the plant would meet an efficiency criterion and showing that the plant would reduce greenhouse gas emissions as compared to sending the same amount of waste to landfill.
"The SKIP committee is currently considering what next step is appropriate."
The Royston Kilbride facility is the latest energy from waste facility to spark conflict between local and national planning authorities.
Last month, the Welsh Government announced an investigation into planning permission for a wood-fired incinerator in Barry, which it said may have been granted unlawfully due to a potential breach of European environmental regulations.
A few days later, London mayor Sadiq Khan criticised plans for an incinerator in Bexley, which he said were in conflict with national planning policy, and called on the government to refuse permission for the project.