Landfill owner Scope Resources says it will reduce both odour and greenhouse gas emissions from the facility.
The smell has been dogging nearby Gibbston residents, and motorists passing by on State Highway 6, for years, especially on winter mornings.
Scope contracts manager Vanessa van Uden said the system was switched on in early April, and fully commissioned on June 1.
It consisted of 24 wells drilled about 20m into a fully-sealed part of the landfill, with pipes from each well connected to a ring pipe encircling the mound.
The methane produced by the buried organic waste was piped to a flare that destroyed the gas by burning it at about 760degC, Ms van Uden said.
The computer-controlled system would "significantly reduce" the odour coming from the landfill, and by preventing methane from entering the atmosphere, was in line with the Queenstown Lakes District Council’s climate action plan.
The company has a long-term contract to manage the landfill, which opened in 1999, on behalf of the Queenstown Lakes and Central Otago districts.
The cost of the system, which was funded by Scope, is effectively being repaid by the Queenstown Lakes District Council over the remaining 14-and-a-half-year term of the contract through an increased gate fee for waste deposited there.
In a media statement, council property and infrastructure manager Peter Hansby said the system was designed in anticipation of changes to the Otago Regional Council’s air discharge consent conditions, issued in 2019, which required landfills to meet national air quality standards.
The two-year project had been a highly technical operation and a "massive undertaking", and further installation would occur as the landfill grew, Mr Hansby said.
The extent of the landfill’s growth would determine the amount the council paid to the New Zealand Emissions Trading Scheme to buy emissions units.
Because that cost was recovered through waste service fees and charges, the best way to minimise the financial impact on the community was for residents to reduce the amount of organic waste they put in their wheelie bins.
"Instead of throwing out your organic waste, why not use it to boost your soil and reduce your carbon footprint by composting?"
Beneficial uses of the methane, such as electricity generation, were not expected until the landfill was much bigger and able to generate more gas, he said.