Dairy Industry Submission To
Dairy Industry Submission to:
Victorian Government
Victorian Energy Efficiency Target Stakeholder Consultation April 2015
The case for exclusion of the dairy industry from the VEET scheme
For 20 years, the Australian dairy industry has been investing in new technologies and practices to reduce green-house gas emissions (GHE). This strong commitment is enshrined in an industry-wide Sustainability Framework that has won acclaim both in Australia and abroad for its proactive and future-facing proposals.
The Framework commits the industry to improving resource efficiency and a 30% reduction of GHG emissions intensity by 2020. The industry reports annually on Framework targets and progress has already been, for example, in 2014 a 14.5% drop in company GHE emissions and 10.5% fall in water use intensity were reported.
In addition, Dairy Australia and a number of large dairy companies have joined the Global Dairy Agenda for Action (AGDAA) and committed to the 11 key sustainability criteria and Strategic Intents.
It is the dairy industry’s view that the activities under the current VEET scheme do not support the strategic plans for the industry's investment in improving energy efficiency. Further, the extra cost burden of the scheme will divert funds from investment in resource and processing improvements and reduce our international competitiveness.
More than 60% of the national dairy industry is based in Victoria with a focus on the export of milk powder, cheese and whey products. These are energy intensive products, and rising energy prices have galvanized dairy companies to act to improve at the margins.
The profitability of the industry is driven by investing in the incremental improvement of energy and processing efficiency along the supply chain and has included new plant and equipment, new technologies, and research focused on energy efficiency and energy recovery.
The VEET scheme represents a cost of $1.2M to Victorian dairy processors, which is a significant burden and risks the competitiveness of the industry.
The preferred option for dairy is a voluntary scheme where companies can opt in with the ability to choose the type of investment and activity covered by VEET and sell certificates to offset investments costs.
Individual dairy companies have indicated that they may register for VEET if the activities covered under the scheme have a beneficial outcome for the company. It must be remembered that the investments being made are very specific technologies unique to dairy processing and not generic with other industries.
Due to the costs associated, these technologies are now taken up with replacement of old plant and equipment or the building of new green field factories. These include:
- Evaporators and dryers for milk powder production
- New milk processing equipment E.g. Plate heat exchangers, membrane filtration systems and cheese processing equipment
- Milk processing equipment for UHT and fresh pasteurised milk
For further information please contact:
Dr Peter Stahle
Executive Director
Australian Dairy Products Federation
Mob 04 1935 6404 email