The new screen comes as the Environmental Protection Authority issued Wannon Water with a pollution abatement notice in mid February after inspecting the premises and reporting "potential for foreign material to be discharged through the outfall".

The notice required the water corporation to upgrade the plant's screening equipment by March 16 to "prevent further litter from being discharged from the premises".

Wannon Water installed the new screen in early February further upstream in the outfall than two pre-existing screens it installed following a 2017 nurdle spill.

Wannon Water's service delivery general manager Ian Bail said it now meant that at least one fine screen was in place at all times during the plant's operation.

"If the first fine screen becomes blocked and overtops for some reason, the wastewater will still be filtered through the second fine screen," he said.

The water corporation also has plans to install a new $1.1 million screen in June.

Beach Patrol campaigner Colleen Hughson said the notice showed that sewage-related litter that volunteers had collected from Shelly Beach was "not related to historical events".

"We are very disappointed that Wannon Water allowed volunteers to continue to clean-up sewage-related debris off Shelly Beach when they could have commissioned a third screen two years ago," Ms Hughson said.

"An admission that cotton buds get through the screens would've saved us plenty of time."

She said it was " too early to tell" whether the new screen had improved cleanliness on Shelly Beach, but said she had not noticed fat balls on the beach since mid February.

"We are very hopeful that things will improve," Ms Hughson said.

EPA south-west regional manager Carolyn Francis said the pollution abatement notice "provides clarity on requirements and sets timelines for compliance".

"The need to remove the outlet screens for cleaning has to date increased the risk that discharges may occur which is why EPA wants to see rapid improvements in the system," Ms Francis said.

"We understand that the first improvements have now been installed and plans for further improvements are well under way, and should be installed mid-year."

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