The recycling firm at the centre of a month-long fly infestation in Avonmouth has been awarded a new contract by the council.
Bristol City Council has chosen to renew Boomeco's current wood recycling contract for another two years.
The infestation broke out in bales of biofuel – unrelated to wood recycling – which were being stored on the dockside in May this year.
The council said the company, which was closed down for a short period during the infestation, passed "rigorous tests" to continue processing wood at the plant.
Wood recycling is a separate process to refuse derived fuel which triggered the swarms of flies.
However, the decision to award the contract is likely to anger local residents who have also complained of wood dust pollution near the port over the last three years. Boomeco is not the only company processing wood on the site.
Council experts say they have taken special care to advise decision-makers on any potential impacts from the wood processing part of Boomeco's business.
Tim Borrett, a spokesman, said: "They've concluded that there should be no adverse impact on fly, noise or dust issues, as the processing takes place in a contained shed to limit noise and dust.
"This advice is borne out by experience over the last 12 months, where wood processing has not resulted in any complaints of this nature."
He added that the alternative of sending wood to landfill would cost the city an extra £400,000 each year and reduce its waste recycling rate by around 3.5 per cent.
Gus Hoyt, assistant mayor for neighbourhoods, said: "This is a good value contract which will make sure we continue to recycle the city's waste wood in an efficient way which has minimal environmental impacts.
"The nature of the waste wood make flies a non-issue and the arrangements for reducing noise and dust should mean there is no cause for complaint.
"It goes without saying that we expect and demand a high standard of service and will keep a very close eye to make sure operations are problem-free and any issues are dealt with quickly and properly."
The council has pledged to keep a close eye on the contract, requiring monthly reports from Boomeco about their arrangements and operations, including any complaints they receive and copies of Environment Agency inspection reports.
The council will also reserve the right to inspect the site and its operations at any time.