Eleven workers were taken to hospital after an uncontrolled discharge at the Poolbeg incinerator in Dublin.
Covanta, the company which runs the recently opened waste-to-energy plant, said scaffolders were working inside the facility when the incident happened shortly before 11pm on Wednesday.
It is believed to have been a discharge of lime which is used in the treatment of waste.
The workers, who had been removing scaffolding inside the plant, were given first aid at the site and subsequently taken to St Vincent's Hospital in south Dublin.
Two of them were kept in overnight
The Health and Safety Authority (HSA) said it was notified by Covanta at 6am on Thursday of an "uncontrolled release" at the plant.
The Environmental Protection Agency (EPA) was also alerted but the company said the workers were inside the plant and that there was no release of lime to the atmosphere.
A HSA inspector has been on site as investigations continue into the cause of the discharge.
"It was not an explosion," a spokesman said.
Covanta said: "A small amount of lime was inadvertently released inside the flue gas treatment area.
"Combustion Unit No 1, which was operating at the time, was shut down in an orderly and controlled manner. The lime was contained within the building and did not escape into the environment and the incident had no impact whatsoever outside the plant."
It is understood the incinerator was still undergoing commissioning and testing on Wednesday night when the incident occurred.
The energy company added: "The safety of our employees and contractors is of utmost importance to Covanta and we are investigating the incident thoroughly.
"We are investigating to understand what exactly occurred, but it appears from preliminary investigation that the release of the lime was due to a problem with a door seal in the fabric filter baghouse."
Green Party leader and TD for Dublin Bay South Eamon Ryan said: "This incident is extremely worrying, given the incinerator only began operations this week. Our thoughts are with the 11 people affected.
"We're calling for all activities at the site to cease while the investigation is carried out."
It is a week since Covanta described the Poolbeg incinerator as reaching its "important first fire milestone" where waste was burnt for the first time.
It is 20 years since the 600 million euro facility was first proposed.
The development was delayed by local opposition, environmental and safety fears, concerns about the level of bin truck traffic in nearby Ringsend and the amount of household rubbish that would be needed to feed the plant and make it viable.
Each year the incinerator will burn about 600,000 tonnes of waste that cannot be recycled. It will generate enough power for 80,000 homes.
According to Covanta's website, the use of lime is part of "s tate-of-the-art air pollution control" which states that acid gases from incineration are neutralised using lime.
The incident has sparked an outcry from opponents in Cork where the country's third incinerator is being planned for the harbour.
A decision on whether it should be given the green light has been delayed four times. The latest deferral gave the company behind the project, Indaver, time to address concerns about potential interference with helicopter flights using Haulbowline Naval Base.
Mary O'Leary, spokeswoman with Chase - the Cork Harbour Alliance for A Safe Environment - said: "It is time to put an end to the charade of safety touted by incinerator operators.
"There are hazards involved at every twist and turn in the process as last night's lime cloud incident illustrates."
Ireland has another waste incinerator, the Indaver plant near Duleek, Co Meath which began generating power in 2011.
The EPA said it was told the lime cloud was contained in the building and that the material was not released to the atmosphere.
"The EPA is satisfied that there was no danger to the public or local community from this release," it said.
The agency also said no rubbish was being fed into the incinerator following the incident and no burning has taken place since.
The EPA said Covanta will be compiling a report on the incident, including outlining the necessary corrective and preventative work to avoid a repeat of the incident.
"On foot of this report, and the EPA's own investigation, further action may be considered by the EPA," it warned.