Peacehaven has been chosen as the site for a controversial £200 million modern sewage works.

Southern Water will make a planning application next year for the wastewater treatment works and sludge recycling centre at Peacehaven East.

The company faces fierce opposition and its choice is likely to have to be resolved by a public inquiry.

A public inquiry dismissed the company's original plans to expand the treatment plant at Portobello, Telscombe Cliffs, two years ago following strong opposition.

Campaigners at the time labelled the site "Portosmello".

The privately-owned site at Lower Hoddern Farm on the north border of Peacehaven was one of 66 under consideration. They were later reduced to eight.

The people of Peacehaven have reacted angrily to the decision.

Former Mayor Peacehaven Pauline Howard said: "Why do they dump everything on Peacehaven. Why should we take all of Brighton and Hove's sewage? It will be fought by the people of this town."

Des Turner, MP for Brighton Kemp Town, said: "Southern Water will have another Portobello fight on its hands.

"I have always said none of the sites proposed in my constituency was suitable. This one is particularly unsuitable as it is on the edge of the Downs, the entrance is through an Area of Outstanding Natural Beauty and there is residential development nearby.

"Southern Water should have gone for a brown field site and will have only got itself to blame if this site is rejected. It should not decide on sites just for engineering reasons and take notice of the planning regulations, which take into account the environmental aspects."

John Carden, chairman of Meridian Labour Party, said: "We are not surprised that this site has been chosen. We have been warning people that Peacehaven East would be the site but the other two main political parties have not helped us on this."

The land at Lower Hoddern Farm is owned by farmer Colin Appleton who grows corn on it.

Mr Appleton, said: "I have no choice in the matter as Southern Water has compulsory purchase powers. Southern Water has been surveying this area for the past five years."

The other shortlisted sites were Shoreham Harbour, Black Rock, Upper Sheepcote Valley, Lower Sheepcote Valley, Ovingdean, Brookside Farm tip in Newhaven and Newhaven North Quay.

Friends of Sheepcote Valley in Brighton were relieved to hear Southern Water had not chosen either of the two sites.

However, secretary Bernard Evans said: "It is regrettable Southern Water has not chosen a brown field site and we call on it to ensure the inevitable environmental disruption is kept to an absolute minimum."

Southern Water said the Peacehaven site was not ideal but was the best practical, environment option.

Major protects manager Damon Elliott said: "Despite the rejection of our Portobello proposals the treatment works still has to be built. It is not an option for Southern Water to sit back and do nothing."

Mr Elliott said the company had gone through an exhaustive process looking at locations.

He said: "Overall we consider Peacehaven East is the best option for a project which is vital to the area."

Wastewater is screened at Portobello before being released almost two miles out to sea.

The three-mile stormwater tunnel under the seafront at Brighton and Hove also helps the city's beaches meet European bathing water standards.

But Southern Water now has to meet the more stringent EU Urban Wastewater Treatment Directive.

It has managed to achieve this in every major resort along the south coast apart from Brighton and Hove.

New works have been built to serve Hastings, Bexhill, Eastbourne, Newhaven, Shoreham, Worthing, Littlehampton and Bognor in Sussex.

Brighton's main resort rivals, Bournemouth and Blackpool, also have modern wastewater treatment plants.

Mr Elliot said: "Brighton and Hove is now the only coastal resort in Sussex, and one of the last cities in Western Europe, not to benefit from modern wastewater treatment."

He said the company had clear legal and environmental obligations to meet the needs of the people of the city plus those of East Saltdean, Telscombe Cliffs and Peacehaven.

They generate 95 million litres of wastewater every day.

Details of the Peacehaven project have yet to be finalised but the works will meet European standards. It will also be able to be upgraded in the future.

The sludge recycling centre will deal with waste removed during the treatment process so that it can be turned into organic fertiliser granules for use in farming.

Southern Water has liaised with councils in the area. It has also consulted the Environment Agency and water regulator Ofwat.

The site it has chosen is just outside the boundary of the proposed new South Downs national park.

Even if things go well for the company, it is unlikely an application will be made before next summer or that the works will be ready before 2008.

The project also includes a lot of adjustments to Portobello so sewage can be dealt with at Peacehaven.

Initial impressions of the site were drawn up during consultation but the scheme submitted for planning permission is likely to look considerably different.

When the application goes in, there will be a full period of public consultation.

Brighton and Hove City Council has welcomed the news and leader Ken Bodfish said: "This decision protects much-loved recreational space at Sheepcote Valley and East Brighton Park.

"It also keeps alive plans for the ice rink and arena at Black Rock.

"I would like to thank the campaign by ward councillors and local groups to protect the sites in East Brighton.

"We do have some regrets Southern Water has still chosen a greenfield site in Peacehaven but we are pleased it appears to have taken on board many of the points we made."

Environment councillor Gill Mitchell said most of the shortlisted sites involved pumping at the derelict Black Rock gasworks site.

She said: "We recognise that even this plan will require a pumping station at the gasworks.

"But we will be pressing the company to provide a building of minimum size and high architectural quality - certainly something more in keeping with the nearby historic buildings than their original plans suggested.

"We would also want it to ensure minimal noise and impact on the locality."