Peacehaven's residents have reacted with horror to plans to build a £200 million sewage treatment works near their homes.

Many were shocked by yesterday's announcement by Southern Water that it had chosen Lower Hoddern Farm at Peacehaven East as its preferred site.

Many said they did not want the town to become a dumping ground for Brighton and Hove's sewage, even though the scheme would also process waste from Peacehaven.

Environmental campaigner John Hodgson said: "This will be fought tooth and nail by the people of Peacehaven. This is a close-knit community where people get together. You say you are organising a meeting and the word spreads.

"There is resentment the town is being earmarked to take Brighton and Hove's sewage. Not enough thought has been given to finding alternative brownfield sites.

"Why can't they treat sewage inland, as they do on the continent, and stop pumping it out to sea?"

Elaine Brown, of Hoddern Avenue, said: "I moved to Peacehaven from London so my children could be brought up in an area where there is nice clean air.

"My mother lives a mile from a sewage treatment works near Sutton, Surrey, and you can sometimes smell it in the area so I know what living near one is like."

Briony Robins, 26, of Piddinghoe Avenue, said many people feared the development would hit property prices.

She said: "We seem to be the dumping ground for everything Brighton and Hove does not want at the moment - extra housing and now sewage. Why should we take Brighton and Hove's muck?"

Peacehaven has had its fair share of planning battles in the past but the sewage works promises to be the biggest since the first bungalows sprang up on the cliff top in the Twenties.

Neville Clegg, 69, lives with his wife, Jennifer, 67, in Piddinghoe Close. He said: "We bought this house for our retirement because of the views. Now we will look out on a sewage treatment works."

Campaigners from the pressure group Surfers Against Sewage said they were angry the proposed plant would only allow for the secondary treatment of water.

They said any plant should use the ultra-violet process to treat the thousands of gallons of raw sewage that is pumped into the Channel off Brighton every day.

Campaigner Richard Hardy said: "Southern Water has ignored the all-year-round use of Brighton's beach by water users and bathers in favour of meeting the bare minimum standards on water quality."

After making a decision, Southern Water now plans to enter into negotiations with Colin and Graham Appleton, owners of Lower Hoddern Farm, to buy the land.

The 12-acre site on the north border of the town was one of 66 considered by Southern Water. The list was later reduced to eight.

The search for a site followed a public inquiry that rejected the company's original plans to expand the treatment plant at Portobello in Telscombe Cliffs two years ago.

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

Yesterday, Colin Appleton would not discuss how much money the land would sell for.

He said: "This site was one of many which Southern Water were looking at. We have had no input in their decision making.

"It is too early to say if we will negotiate a sale on the land but we are aware the company has compulsory purchase powers.

"The only contact we have had was a letter to say the site was one of many being considered."

Geoff Loader, head of communications at Southern Water, said: "We have been looking at Lower Hoddern Farm for more than five years.

"It is close to the existing infrastructure. The land is there and it is available. It is in a bit of a dip and can be screened by landscaping. We accept no one wants a sewage treatment works on their doorstep but with everything considered this is the best option."

The fight against the sewage works is the latest battle against development in Peacehaven.

Many residents have already been fighting plans to build 296 homes between Keymer Avenue and Cornwall Avenue, which have been lodged with Lewes District Council.

Access to the sewage works would be off the South Coast Road before it dips into Newhaven close to Peacehaven Golf Club.

A planning application will be lodged with East Sussex County Council next year. Due to its complexity, it may take another 12 months before a detailed application is submitted.

The site had been thought to be the favourite after Portobello was rejected in March 2001.

Tony Howard, former leader of Peacehaven Town Council, warned residents two years ago it was a preferred site shortly before he died.

Planning inspector Simon Gibbs, who rejected the idea of building at Portobello, which would have meant a treatment plant on the beach at Telscombe Cliffs, said Lower Hoddern Farm should be looked at again.

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

"The company should have gone for a brownfield site. They should not decide on sites for purely engineering reasons and take notice of planning regulations, which take into account environmental aspects."

Norman Baker, MP for Lewes, whose constituency borders the site, said: "I am glad Southern Water has not gone for a site in Newhaven as pumping Brighton and Hove's waste water to Newhaven would have been ludicrous.

"It does not make much more sense piping it to Peacehaven. I've always thought Brighton and Hove should treat its own waste water, not dump it on someone else."

The Victorians developed the first sewage system for the Brighton area.

They built a long tunnel, still in use, to take sewage to a short outfall at Portobello below underdeveloped cliffs a mile south of Telscombe village where it was both out of sight and out of mind.

The Brighton area sewage authority realised something fundamental had to be done in the Seventies.

It built a new plant at Portobello for meshing the waste and constructed a much longer outfall in 1977. It was followed 20 years later by a storm water tunnel under Brighton and Hove seafronts linked to Portobello.

When Southern Water, now in charge of sewage, looked at improving treatment to bring Brighton and Hove in line with the latest European directives, Portobello seemed the obvious place to do it.

But residents in Telscombe, Peacehaven and Saltdean mounted a fierce campaign against the plans, which led to a public inquiry where the plans were rejected.

This left Southern Water with an enormous problem since any other site would be more expensive and just as unpopular.

Experts examined 66 sites in the Brighton area in conjunction with the local authorities, Ofwat and the Environment Agency.

Last year, the list was narrowed down to eight possible sites.

There were problems with the site at Black Rock, which Brighton and Hove City Council had earmarked for leisure use. The council also refused to sell land at Sheepcote Valley to the water company.

The two Newhaven sites and Shoreham harbour were too far away. Ovingdean was in a prominent position and was likely to attract enormous opposition.

This left Peacehaven East tucked away at the back of the town and not too far from Portobello.