The contamination was in August and believed to have been an industrial discharge, Ms Muir said.
She said it was "nearly impossible" to find the source, but if there were more discharges council would consider installing further monitoring equipment, which would help identify the source.
The issue was raised earlier this week by council waste and property committee chairman Nigel McKinlay.
He said the "significant discharge" highlighted how vulnerable the new $8 million membrane filtration plant, which started operating in June last year, was.
Ms Muir confirmed there had been "no publicity" about the discharge at the time it occurred.
"This has not occurred before, and as an isolated incident, we did not consider it required publicity at the time."
Ms Muir said on August 1 some foaming had been noticed around the inlet of the Cromwell wastewater scheme and the first few aerators there.
"Over the next couple of days the ponds changed colour from a rich green to a pinky/red colour and the dissolved oxygen levels dropped suddenly in the first pond. After about 10 days this then occurred in the second pond.
"These changes indicate a drop in biologically activity in the ponds, which is a sign of toxic shock."
Council staff and council contractor Downer New Zealand believed the speed of the change indicated the shock was from a commercial grade and volume of contaminant, Ms Muir said.
"Potentially this could have originated from a domestic property, but this is unlikely."
It took five weeks for each pond to recover, but there had been no "ongoing implications" for the system as a result of the spill, Ms Muir said.
She said the "impact on discharge quality would have been marginal at the time of year that this occurred".
"The new membrane filtration system would have had a greater loading placed on it during this period . . . If the new membrane treatment process [at the treatment plant] had not been in operation then there would likely have been a decrease in effluent quality. This was mitigated by the new membrane filtration process."
Council staff would increase education about and monitoring of trade waste discharges, Ms Muir said.
