Parramatta City, Holroyd and Bankstown councils in NSW have signed a Memorandum of Understanding for a regional tender to turn household waste into energy.

The alternative waste technology will convert methane, the gas produced by decomposing waste and a significant contributor to greenhouse gases, into green energy and feed it back into the electricity grid. The waste will also produce other usable bi-products such as compost and water.

By 2011 more than 80 per cent of all domestic waste in the Parramatta, Holroyd and Bankstown Council areas will be diverted from landfill and used to create reusable products.

By diverting this amount of domestic waste away from landfill every year; there is the potential to prevent the production of greenhouse gas equivalent to taking about 25,000 cars off the road; to produce enough green energy to power approximately 2800 homes; to produce about 10,000 tonnes of valuable organic fertiliser for agriculture; and divert more than 80,000 tonnes of garbage away from landfill.

The tender has been advertised with the successful applicant to be announced by July this year.