it is discarded, not used.
if you have a 2D point (x,y), then in the corresponding projective space (3D), this is represented by (x,y,1), but also all (x,y,1) \cdot s for any nonzero s
you encounter this after matrix multiplication. you normalize (“dehomogenize”) the result by dividing by the last coordinate.
(x,y,1) = (x s, y s, s) / s