Waste-disposal units designed to turn leftover food into electricity and fertiliser could be built around every town and city as part of a scheme being considered by ministers.

The new generation of anaerobic digesters has been developed in a government-sponsored trial designed to find ways of solving the shortage of landfill sites.

They will be ideally located in suburbs because, unlike previous models, the new units are not reliant on farm slurry to provide moisture for the recycling process. Without the smelly transportation of animal waste, the prospect of plants in urban areas, will, the Government hopes, be a lot easier for residents to digest.

The ability to process waste on a commercial scale without using slurry was developed as part of a £30million trial in Ludlow, Shropshire, by Greenfinch, an engineering firm working with government backing, in partnership with South Shropshire District Council. It was prompted by the need to reduce the 16-18 million tonnes of waste food that is buried as landfill each year.

Anaerobic digesters produce fertiliser and biogas, a mixture of methane and carbon dioxide, which is burnt to generate renewable electricity.

The merits of putting them near small villages have become the hot debate in the Radio 4 soap The Archers, where the community of Ambridge is at loggerheads over the proposed installation of a farm-scale unit.

Most waste food in Britain, including 6.7million tonnes from households, is disposed of in landfill sites where it decomposes and contributes to greenhouse gas emissions. The average person throws away four times their own body weight in food each year.

Pressure on space means that the country is running out of suitable sites for landfill and, with punitive landfill taxes introduced to encourage alternatives, digesters are increasingly being seen as an environmentally friendly solution.

Joan Ruddock, the Environment Minister, described Ludlow as “the way forward” after being given a tour of the unit this week.

She said: “Anaerobic digestion is extremely attractive. Why would we go on throwing food waste into holes in the ground when we could generate our own electricity and end up with a product that can be returned to the soil? It seems to me that a plant on this scale would fit into any industrial estate anywhere in the country. While the decision has to be taken locally - and in consultation with residents - I am sure this is the way forward.”

She added that she has taken to listening to the anaerobic digester saga on The Archers: “I try to listen to it when I can to see how they are getting on, but all I seem to have heard about lately is the Grundys' love life.”

David Woolgar, of Greenfinch, said: “The advantage of the new system demonstrated in Ludlow is the likelihood such plants can move into built-up areas.” He is confident that the plants offer a money-making option for councils and businesses.

Philip Dunne, Conservative MP for Ludlow, is an enthusiastic supporter of the digester and believes the technology will simultaneously help to solve the landfill problem and make a profit.

“It holds out the prospect of a commercially viable waste energy system which on its own should reduce local authority waste collection and disposal costs,” he said. At its maximum production level, the Ludlow digester should be able to generate 1,400 megawatt hours of electricity each year, and engineers expect to be able soon to harness the heat generated by the plant.

Anaerobic digester technology has been available for decades and more than 4,000 have been built in Germany. But besides Ludlow, only four other commercial-scale digesters, which in essence mimic the workings of a cow's stomach, have been built in Britain - two in England and two in Scotland - and there are fewer than a dozen farm-scale units.

The Government is so confident that anaerobic digesters offer a realistic means of dealing with food waste that earlier this year it offered £10million in grants to encourage the construction of further demonstrator plants. Plans for at least 60 are under way in Britain.

A variety of technologies for treating food waste are being investigated, but confidence in anaerobic digestion is high and Liz Goodwin of the Waste Resources Action Programme (Wrap), a government-funded body, said the number of plants built in Britain was about to rise exponentially.

Businesses are also showing increasing interest in sending their food waste to digesters rather than landfill and the supermarket Waitrose has just signed up to a trial involving five branches that will send food beyond its sell-by date to a biogas plant run by Biogen in Bedfordshire.

The commercial food recycling scheme is operated by Cawleys, which collects leftovers from organisations including the Treasury, city lawyers and Raymond Blanc's Brasserie in Milton Keynes.

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