Whanganui mayor Annette Main warns there is no quick fix to the "appalling" stench from the city's overloaded wastewater treatment system.
Foul smells from the sewerage system have plagued parts of the city for weeks and driven some residents out of their homes.
Wanganui District Council says the problem stems from large-scale industrial dumping by unnamed companies.
Ms Main said the problem worsened on Friday as sulphide levels soared, though no-one can identify which industry is responsible for these discharges. At least one company is exceeding consents in dumping waste.
She said the smell is appalling at Kaitoke and Lakes Wiritoa and if the wind shifts to the east, Castlecliff, Gonville and the central city will be affected.
The mayor said the distressing fact of the matter is the council cannot eliminate the smell, and there is no short-term solution, apart from discharging waste into the Whanganui River or the ocean, which is unacceptable.
Ms Main said she would meet local businesses on Monday and the council will need to have a major review of the industrial trade waste systems in the New Year.
'Rotten offal' smell in nearby homes
Paulette Stent, who lives just across the river from the sewage ponds, says the odour hanging over the neighbourhood for the past couple of weeks has ruined her family's Christmas holiday.
She describes the smell, which comes in waves, as a combination of sulphur and rotten offal and says even in the extreme heat and humidity her family has been forced to keep doors and windows closed.
"When it's sweltering hot you want the house open, but all of a sudden the smell will waft across and you want to close the house up. You've got to sit there and put up with it."
Mrs Stent says many residents believe the council is trying to pass off its responsibility in blaming the problem on rogue companies dumping waste.
District councillor and former mayor Michael Laws said the system has been failing for years and the council should compensate affected residents.
Mr Laws, who was mayor when the treatment plant opened in 2007, maintains an independent inquiry is needed and said it is possible the system will need to be scrapped.
The chair of the council's infrastructure and property committee, Ray Stevens, said the first priority was to get the problem fixed and staff are working 24 hours a day to do so.
Mr Stevens won't name the companies thought to be responsible for the dumping of industrial waste that has overloaded the system but said the council may seek compensation from them.
He said the sewerage system, which has never been used anywhere else in the world, has cost $120 million over the past 10 years and the council has to make that investment work.