Hills Waste is scaling back plans to extend its materials recovery facility at Lower Compton following criticism from residents and councils.
The site is used to sort household waste and collect recyclable materials which are shipped off elsewhere.
An application to extend the site, as well as to make it permanent, was submitted in 2012 but a decision on this has not been made.
The company now proposes to submit a new planning application, billed as a “smaller and significantly scaled down scheme”.
If successful it will withdraw its previous applications for the site.
Mike Webster, group director, said: “We have listened to and considered previous local opinion.
“We feel that this new planning application reflects local views and whilst the site remains of strategic importance to us, we have significantly scaled back our operational plans.
“Following feedback on previous planning applications, Hills is no longer including the construction of a commercial and industrial waste treatment facility, which was the main source of public concern.”
The new proposed extension will provide capacity to sort up to 55,000 tonnes of recyclable waste per year.
Hills also hopes to build a new waste transfer station, so that lorries can take sorted materials elsewhere.
The two facilities would process around 130,000 tonnes – a 45 per cent reduction compared to the previous application in 2011 which was for 235,000 tonnes.
Wiltshire councillor Alan Hill said: “Wiltshire only sends 20,000 tonnes to the recycling facility so where is the rest coming from?
“If it will be bringing in waste from outside the county, that should be on a strategic road network not tucked away on a country lane.”
Town councillor Tom Rounds said: “The bottom line is there will always be a pollution problem in this town as long as that facility stays there.”
Hills is holding a five-week pre-planning consultation, and will hold a public exhibition on July 1 at Compton Bassett Village Hall from 10am to 8pm.