The cups and lids will be introduced from September this year
All coffee cups and lids bought in SuperValu and Centra will be 100% compostable from September, the retailers have announced.
The Musgrave-owned stores - which sell Frank and Honest brand coffee - are hoping to divert millions of coffee cups from landfill.
CupPrint and Down2Earth Materials will provide the new cups, and 20 new jobs will be created in Ennis and Cork 'to cater for the increase in production'.
Environment Minister Denis Naughten launched the initiative today, describing it as a 'significant move'.
He said: "Today’s announcement is a significant step that supports my policy priorities in the waste area which includes my desire to work with industry to ensure single-use plastics are eliminated.
"I am also really pleased to see two Irish businesses - CupPrint and Down2Earth Materials – benefit as a result of this.”
Martin Kelleher, Managing Director of SuperValu and Centra, added: “We looked for innovative Irish based companies to partner with in order to offer a more sustainable coffee cup solution and we are delighted to work with CupPrint and Down2Earth Materials to deliver this.
"The job creation this has led to and the environmental benefits our shift to compostable coffee cups will deliver will help leave a more positive impact on the communities we serve every day."