Traditional composting systems for biowaste generally produce low quality composts that may endanger recycling. A pilot-scale bioconversion process yielding quality compost and renewable energy was designed and tested. The process consisted of a set of wet physical separation units, composting and anaerobic digestion. Biowaste was divided in four streams by physical separation: (1) organic fraction >2 mm, (2) inorganic fraction 0.05-2 mm, (3) residual fraction composed of organics 0.05-2 mm and the fraction < 0.05 mm and (4) a fraction solubilised in the washing water. The organic fraction >2 mm was composted and the compost, high in organic matter and low in EC and heavy metals, aimed at replacing peat in horticulture. The inorganic fraction 0.05-2 mm was completely made up of sand and can be used as a construction material. Solubilised organic matter in the washing water was converted to CH4 by anaerobic digestion. The residual fraction can be used as landfill cover material. (C) 2003 Elsevier Ltd. All rights reserved.