The plan comes after Baiada won development consent to build a new $300 million poultry processing plant last year, which will double the size of its existing facility, and require four times the water.

The site would use reverse osmosis to recycle saline effluent to produce high-purity water for industrial use.

Cr Mark Rodda said council led the way in 1888 with electricity, and now it would lead the way with water.

"I realise that it's a significant investment but with the next drought right around the corner, I believe that this prepares us for that situation," he said.

"I hope this investment will encourage the other tiers of government to jump on board and assist our council.

He said while the water would not be potable water standard, it would be purified to a standard that the city's abattoirs and other industries could utilise.

"It's important to note that this cutting edge technology and facility will be utilised by a range of users not just the chicken processor," he said.

"I wholeheartedly support this project and look forward to seeing it operating."

A cost benefit analysis estimated the project to cost $75.3 million upfront, followed by $25 million each 15 years.

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Wastewater would flow in from beef and lamb abattoirs as well as Baiada's existing plant and its new one. It would then be treated to an industrial standard before being sent back to be used by the same customers that generated it.

Cr Bede Burke, a local chicken farmer, said combined abattoirs use about 40 per cent of Tamworth's water.

"When Baiada moves to that precinct where we already have a lamb and a beef abattoir, it gives us the opportunity to wholesale recycle up to 80 per cent of that 40 per cent of the water they use," he said.

"There's other high water users that may see that precinct as an attractive proposition to relocate their business to Tamworth."

The project received unanimous support at last night's council meeting, with Cr Marc Sutherland joining the chorus of praise for council's planning team.

He said after going through one of the worst droughts on record, water security should be top of the priority list.

"It's great to know the vision isn't just focusing on water storage, but how we can use and reuse waste water more responsibly," he said.

Director Water and Waste Bruce Logan said one of the other benefits will be improved quality of effluent at council's Westdale Water Treatment Plant, through the reduction of load.

Council will allocate an additional $1,735,000 from the Wastewater Reserve to undertake designs and costings as soon as possible, and lobby state and federal governments for funding.

But it won't be winning over the support of Deputy Prime Minister Barnaby Joyce any time soon, who said while he valued water security, he would focus on getting Dungowan Dam built before allocating funding to other projects.

"It's a good idea, but we need to build a dam first," he told the Leader.

"We have funding for the dam. You can't purify water if there's no water to be purified."

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