The waste depot at Kembla Grange was designed to be built in three stages. The first stage opened in 1983 and was used for a decade until 1993.

The second stage has only about four years left until it will reach its capacity, prompting Wollongong City Council to start planning for the final stage, which will allow the facility to continue accepting waste until 2060.

There are also plans to replace the 13-year-old recycling facility located next to the Whytes Gully entrance gate by 2013.

The facility accepts and processes recyclable materials that are collected by waste contractor Thiess from bins with yellow lids across Wollongong and Shellharbour.

The project is part of an overall waste strategy being developed for the city.

Last week, the council resolved to spend $1.3 million on the purchase of an adjacent property at Kembla Grange to construct the new regional materials recycling facility and transfer station.

"A material recycling facility is used to sort recyclables so they can be transported off site for reuse," infrastructure and works director Peter Kofod said.

The existing recycling centre will be modified into a transfer station for small domestic and commercial vehicles.

The new transfer station will include a recycling drop-off area, a hazardous household waste drop-off point and storage area, and a mixed waste sorting area to recover resources before they end up in landfill.

The project will eliminate the need to otherwise transport 30,000 tonnes of unprocessed recyclables to Sydney or Canberra each year.

The council is also developing other strategies to reduce the amount of organic, recyclable and hazardous material ending up in landfill.

The council will need to obtain the approval of State Government agencies to develop the third stage.

"Council will consult with the surrounding community ... as we progress ... ," Mr Kofod said.