One of the common examples of a typical marine fish tank setup is to have a sump system which is just another separate smaller tank located at the bottom of the main aquarium. It consists of multiple chambers which allows water to flow through a series of filtration units, each playing a different role to filter and convert the waste into less harmful chemicals like the nitrates before being removed via consumption by the algae and finally before the water is returned to the main tank.
How it works and the mechanism

First Chamber | Second Chamber | Third chamber | Fourth chamber |
Mechanical filtration using sieve, bags or external canister filter (optional: protein skimmer) | Wet/dry trickle filter to turn ammonia and nitrites into nitrates | Refugium whereby most of the nitrates are consumed by the macro algae. | Choice of either phosphate remover, activated carbon or calcium reactor |
How to start and then putting things together
Setting up a sump system with a refugium usually can be accomplished by buying a custom made tank and then getting all the individual equipment or it can be as simple as purchasing a complete set or pre-assembled unit as I know some companies like Aqueon, Precision Marine and Eshopps supply them and it is only a matter of putting all the parts together. The hardest task and the main challenge after everything is set up is to jumpstart the system and get all the living organisms to live there. Chaetomorpha which is the macro algae can be easily bought from a local marine fish shop that sells them in bulk or you can simply ask a friend or local hobbyist in your community for help. Usually these plants will regenerate and grow very fast (provided that it lives in the right environment), thus most people would not have qualms about giving them away. One of the main aspects to ensure survival of the algae is getting the right lighting and most people prefer getting the compact fluorescent high intensity type such as VHO with the Kelvin range around 6500K. My first refugium lighting which I bought at much lower price compared to the normal units, fails miserably as I found that it could not sustain the growth of the algae resulting in pale green color of the plants and the bulb often encounters premature failure and has to be constantly replaced. Thus getting the right type with the spare parts readily available is very important and you should be careful not to jump into conclusion based on the price factor. I wouldn’t provide any recommendation here but searching online seems to yield quite a number of results and my suggestion is to check out the reviews.
How to ensure a healthy and self-sustaining refugium
Other than lights, other important aspects toward maintaining a healthy refugium is to ensure there is sufficient water flow and circulation. As explained earlier, the algae receives all its food from the waste material generated by the fish and thus selecting the right pump that delivers enough water back to and from the main tank is very important. Depending on the size of your aquarium, you will need a pump that can deliver the amount of water enough to circulate at least 3 to 4 times the capacity of your display aquarium in an hour and depends on the number of fish, more means you have to increase the pump capacity. As a rough guide, if let’s say you have a 100 gallon marine fish tank, you will need a pump that delivers the flow between 300 - 400 gallons per hour but however, some experts will always have different opinions. Overloading the sump system can also contribute towards failure of the whole process as high bio load can result in toxic accumulation that can render your refugium ineffective. That is why I included the protein skimmer as an optional item in between, installed after the mechanical filters but before going in to the refugium. This is to ensure that some of the waste is being removed prior to feeding to your algae and depending on situations, if you have a standard unit which is well maintained, that should take care most of your problems.