Poon Chi-sun, chairman of the waste subcommittee of the Advisory Council on the Environment, said the idea was worth exploring.

'These facilities are unavoidable yet unwelcome everywhere,' he said. 'Even if they are going to meet the most stringent environmental requirements, residents might still feel bad psychologically. So the idea of compensation is worth looking at.'

Taiwan requires operators of incinerators to return part of the revenue from rubbish fees and electricity sales to local residents in the form of subsidies on utility fees.

Residents may also get their own free community and recreational facilities.

Debate on the proposed Tuen Mun incinerator comes as further controversies are expected, when officials push ahead with a long- delayed plan for a mega waste-to-energy incinerator, rubbish separation or composting facilities.

The site eyed is part of the existing coal-ash lagoon operated by CLP Power, at Nim Wan. At a cost of about HK$2.7 billion, it will have a daily handling capacity of 2,000 tonnes when it opens in 2012.

The site, at the far western tip of the city, was selected from nine potential sites in a feasibility study commissioned by the Environmental Protection Department.

To minimise air pollution, officials have pledged it would be fitted with technology to ensure the lowest possible emissions with generating capability to meet the needs of 3,000 households.

Lam Kin-che, chairman of the Advisory Council on the Environment, who has visited incinerators in Taiwan, said the idea of compensation was worth considering, although whether it could be applied in Hong Kong was another issue.

'There was opposition, too, at first, but the facility seemed to have assimilated well into the community,' Professor Lam said, referring to one incinerator he visited in Taiwan.

A government source said the Tuen Mun debate should not focus on minor and immediate benefits but overall planning and economic development that could reshape the whole district.

Taiwan's trade-off

Existing waste treatment facilities

Chemical waste treatment plant - Tsing Yi

Landfills - Tuen Mun, Tseung Kwan O, New Territories North

Planned facilities

Mega waste-to-energy incinerator - possibly in Tuen Mun

Mechanical and biological waste treatment plant - location unknown

'Compensation' for people living near incinerators in Taiwan

Peitou incinerator in Taipei: free warm-water swimming pool, electronic library, sports ground and gymnasium

Keelung incinerator: pre-school nursery, revolving restaurant, electricity and water tariff subsidies amounting to a few hundred Taiwan dollars for each household

Tainan incinerator: spa and man-made beach, water recreational centre