Mr O'Loughlin said the proposed thermal conversion plant in Fyshwick would provide no incentive for the ACT government to reduce waste levels and believed more work needed to be done on education programs, separation facilities and compost before it is approved.

"If you're building a facility of any sort which requires a large amount of waste it'll need fuel. I'm worried we won't take other steps to reduce waste because we'll need to fuel it," Mr O'Loughlin said.

The proposal from Capital Recycling Solutions came months after the Conservation Council raised concerns the government had left the door open for incineration, biogas or other greenhouse gas emitting proposals without committing to other ways of cutting waste production.

Mr O'Loughlin said it was not yet clear how the plant would impact the ACT's emissions targets.

"One of the things the ACT government is trying to do is get the ACT to zero net emissions. If you're going to be burning stuff how are you going to let to zero net emissions? You'd have to be planting a forest somewhere to offset it," Mr O'Loughlin said.

The project, headed by former Wallabies coach Ewen McKenzie, would turn 90 per cent of the rubbish sent to Mugga Lane and turn it into electricity. It would be a 50:50 joint venture with ActewAGL.

The company is currently putting together environmental impact statement, which will be released in the coming months.

The firm has already commissioned research on people's attitudes to a waste to energy plant, with four focus groups held in February, one including Narrabundah residents. It concluded that people were "generally positive" about waste to energy, but needed much more information about emissions to feel comfortable.

Mugga Lane was the preferred location, with some seeing Hume as feasible. South Canberra residents most opposed to a plant at Fyshwick. People were also concerned about its proximity to places of food production and sales, the lake and the Molonglo River. And they were concerned about trucks. The research said the Fyshwick location "is likely to encounter significant local concern and will require an extensive community engagement program to manage reactions and the dissemination of factual information".

The most compelling messages for people were that the technology was used in 22 European countries, and the plant would mean waste no longer had to be buried.

"The community appears to be most open to [the project] being framed as an environmental and energy solution, including the reduction of methane emissions, maximising space and preventing health issues from landfill," the research advised.

While incinerators and waste-to-energy plants are common around the world, there is nothing similar in Australia. One plant has approval in Western Australia, to be built in the Kwinana industrial area 40 kilometres from Perth, and much further from residents than the planned Fyshwick plant.

The nearest "sensitive receptor" to the Kwinana incinerator is about 2km away. In Fyshwick, Narrabundah residents are less then 1km away, and caravan park residents much closer still.

Western Australia originally banned commercial and industrial waste from its plant, but appears to have amended its approval to allow it now. It will not allow sewage sludge, which is proposed for the Fyshwick operation.

The main concerns from waste to energy plants are particulate matter and dioxins, among other pollutants, with concern also about the toxicity of the ash left as residue. Capital Recyling has not detailed its flue cleaning plan, other than saying dust would be separated, heavy metals extracted, sulphur and acids removed, and pollutants such as dioxins destroyed.

Capital Recyling says it can use the "bottom ash" as road base and the like, but in Western Australia, a proposal to use bottom ash in brick making was knocked back until safety can be shown.