Domestic or commercial wastewater is liquid waste and sludge, including human waste, from housing or commercial premises, respectively. Industrial wastewater is liquid waste and sludge resulting from the production of specific commodities by specific industries. It excludes wastewater generated during primary production such as piggery or dairy manure, but includes, wastewater generated during the processing of primary products such as milk or pork.

The aim of a wastewater project is to reduce biogas emissions by replacing open lagoons with enclosed systems. Wastewater is sometimes treated in deep open anaerobic lagoons (i.e. under conditions without oxygen). Under anaerobic conditions, bacteria break down the wastewater and produce biogas, which is a mixture of carbon dioxide and methane. In an open lagoon, the biogas is released to the atmosphere.

For an open lagoon to be eligible for replacement as part of a wastewater project, it must be more than two metres deep and must have been in existence before 24 April 2014. It must also have been used to treat any combination of eligible domestic, commercial or industrial wastewater for the 12 months before you apply to run a project.

The open lagoon must be replaced with an anaerobic digester, which is a system that captures the methane produced during wastewater treatment. An anaerobic digester can be created by covering an open lagoon, or by building an engineered biodigester – a closed vessel that has heating and stirring features. The anaerobic digester must be able to transfer the captured methane to a combustion device that can use the methane as fuel.

Refer to parts 2 and 3 of the method and explanatory statement for more information about wastewater eligibility requirements.