a refugium is either a section in a sump or a hang on the back type that usually contains a deep sand bed, live rock rubble and macro algae..The live rock and sand bed act as additional filtration for the display tank and the macro algae is there to out-compete any algae in the display tank for nitrates and phosphates which keep algae in the display tank ( hopefully ) near nothing...
Refugium ( fuge ) is not a "got to have" thing, its just an added bonus to the system and helps out loads in tank maintenance if your system is a reef...
Niko