Central Highlands Water is still reviewing how to connect smaller towns like Bungaree and Wallace to sewerage networks, but more work will need to be done before any announcement is made.
CHW managing director Paul O'Donohue said new lines were decided on a case-by-case basis.
"We've said to council there's three important things, one is funding, two is what size are these towns going to be - you have to set the infrastructure at the appropriate size - and thirdly, does the community want it," he said.
"At the moment they're both relatively small towns.
"Then it's how is the project going to be funded - those are the things that need to be fully considered before you then develop a final business case and take it anywhere."
Moorabool Shire Council mayor Tom Sullivan said discussions were heading in the right direction.
"We understand it'll take time," he said.
"There's a lot of support in the community for this, and the reality is, there's an understanding without this the towns will stagnate and fundamentally have little future - that's where we're at."
IN THE NEWS
Moorabool has already allocated $1 million to the project, which could benefit Ballarat as it experiences rapid growth.
"The work we did with an engineering company indicated there's enough sunk infrastructure to support a population of about 8000 people - not to maximise the effect would be criminal," he said.
"The only piece of infrastructure that's lacking is sewerage - arguably it would help contain the towns and not impose on good agricultural land, concentrate development."
Have you signed up to The Courier's variety of news emails? You can register below and make sure you are up to date with everything that's happening in Ballarat.