Filamentous bulking and the long sludge age required for nitrification are two important factors that limit the wastewater treatment capacity of biological nutrient removal (BNR) activated sludge systems. A growing body of observations from full-scale plants indicate support for the hypothesis that a significant stimulus for filamentous bulking in BNR systems in alternating anoxic-aerobic conditions with the presence of oxidized nitrogen at the transition from anoxic to aerobic. In the DEPHANOX system, nitrification takes place externally allowing sludge age and filamentous bulking to be reduced and increases treatment capacity. Anoxic P uptake is exploited in this system but it appears that this form of biological excess P removal (BEPR) is significantly reduced compared with aerobic P uptake in conventional BNR systems. Developments in the understanding of the BEPR processes of (i) phosphate accumulating organism (PAO) denitrification and anoxic P uptake, (ii) fermentation of influent readily biodegradable (RB)COD and (iii) anaerobic hydrolysis of slowly biodegradable (SB)COD are evaluated in relation to the IAWQ Activated Sludge Model (ASM) No.2. Recent developments in BEPR research do not yet allow a significant improvement to be made to ASM No. 2 that will increase its predictive power and reliability and therefore it remains essentially as a framework to guide further research.