The revived Dennington milk factory in south-west Victoria has undergone a world-class $20 million expansion with plans for a $3.8 million solar farm unveiled to help drive down soaring energy costs.
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ProviCo took over the site in 2020 after the closure of the former Fonterra factory and has plans to continue to grow the business, which now employs 54 people.
Chief executive officer Ben Anderson said its new state-of-the-art lactoferrin plant had been operational for about a month.
"We're really excited about what's going on here," he said.
Mr Anderson said the proposed solar farm near its waste water processing facility would generate enough electricity to run the new lactoferrin plant, or about a quarter of the whole factory's energy needs.
They have also recently replaced 800 lights with energy efficient LEDs to lower costs.
He said energy costs for ProviCo had nearly tripled over the past 12 months.
"Utility costs have gone up markedly over the last 12 months. Gas in particular. We use a lot of gas and electricity here," he said.
"The solar farm is a subsidy for our electricity usage. Electricity is the one that's forecast to increase in particular over the next 12 months. Outside of ingredients and labour, it's our next biggest cost."
READ MORE: What rising energy costs mean for dairy
Mr Anderson said the increase in energy costs was having a significant impact on the business.
But offsetting the cost with solar power would not only make them more competitive and efficient, it would also help reduce its carbon emissions.
"Environmentally, it's the right thing to do," he said.
"In all of our businesses we look for ways to reduce our environmental impact."
A planning application for the small solar farm - which will be constructed at the rear of the property - says it would not be visible from the road and vegetation would obscure it from neighbouring properties.
Mr Anderson said the initiatives they were implementing at the plant were about future-proofing the business and the site.
"The objective of everything we are doing is about optimising the return on each litre of milk that comes through the plant," he said.
"It's about setting up to provide benefits to the community for the next 100 years, not just the last 100."
Mr Anderson said the measures would give them the confidence to invest further in the site which, would in turn create more jobs.
The first milk went through their new state-of-the art lactoferrin facility at the end of September.
Mr Anderson said ProviCo owner Andrew Paterson was the drive behind the business.
"Andrew invested in the site and very quickly determined that the way in which to grow this dairy business is by investing in valued-added specialised nutritional products," he said.
"The lactoferrin is the first step in our specialised nutritional strategy."
Lactoferrin is a natural occurring protein that exists in both human breast milk and cow's milk.
At ProviCo's new plant, the lactoferrin is extracted from skim milk and turned into a powder, which is used as ingredients in other products such as infant formula, bionutritionals and sports nutrition products to help develop a person's immune system.
Its inclusion in infant formula allows it to more closely replicate what a child would get from human breast milk.
"We definitely wouldn't want to say it's replicating it, it's just getting it closer," he said.
The factory's new product would be sold domestically but predominantly exported around the globe.
The factory also produces Growing Up Milk Powders and a number of varieties of fat-filled milk powders that are exported mainly into the Middle East and Africa.
"We're predominantly a producer of functional ingredients and specialised nutritionals," Mr Anderson said.
"The technology that we've been able to apply here, given that it's further down the track in comparison to when other companies invested, it's really world-class technology."
Since taking up his role at the Dennington plant, Mr Anderson said he now understood how important the factory was to the community.
"It is such a prominent feature in the landscape of this side of town, for the local people to see it back up and operational is really positive," he said.
The site was Nestle's first factory in Australia which began operation in 1911, producing sweet condensed milk and later Milo and coffee.
After 94 years, Fonterra took over the site in 2005.
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Katrina Lovell
Katrina Lovell is a senior journalist at The Standard who covers council news and human interest stories.
Katrina Lovell is a senior journalist at The Standard who covers council news and human interest stories.
