Wednesday, 23 June 2021 13:55

Farmers to power own plant

Written by  Staff Reporters
Arla hopes to be a carbon net zero dairy co-operative in 2050. Arla hopes to be a carbon net zero dairy co-operative in 2050.

European dairy co-operative Arla says renewable electricity produced by its farmer owners could soon be used to operate in milk plants.

Arla says it is closing the loop on the renewable electricity produced on-farm in a move that reduces the carbon footprint of Arla's milk, secures farmers a better price for their power and gives the cooperative direct access to more green electricity certificates.

Many of Arla's cooperative farmers generate green electricity for their own farms and for the public grid.

As Arla is looking to increase its share of renewable energy in its operations, the company will now keep the farmers' green electricity in the dairy value chain and provide a better profit for the farmer.

"Arla farmers can help their own company to accelerate the transition to renewable energy while the company can maximise the value of their investments in renewable energy," says Hanne Sondergaard, Arla's head of sustainability.

"This demonstrates how we in our co-operative's micro food system can work together to increase the sustainability of our value chain to the benefit of our owners, our business and the environment."

Technically, the loop is created via the Guarantees of Origin (GO), an EU instrument that proves to a final customer that a quantity of electricity originated from a specific renewable energy source.

Until now, the farmers' only option has been to sell their GO as a commodity for resale, either through a utilities company or a trader. Now though, by selling their GO directly to Arla, the other parties are left out of the transaction and the farmers are rewarded with the full market value that Arla would pay for GOs on the open market.

Genetating 'circularity within its own value chain' is a move welcomed by Arla's chairman, Jan Toft Norgaard.

"With this opportunity, the green energy that our owners produce can be counted as part of our collective actions to make dairy products more sustainable.

"The full profit for the GOs that we are able to secure the farmers with this move has no extra cost for the cooperative and is a positive contribution to the business case for Arla farmers who can consider investing in renewable energy."

In Arla's operations, emissions have been lowered 24% since 2015 and the share of renewable energy used in operations is currently 35%. A continuous increase is part of the ambition to reduce total emission by 30% from 2015 to 2030 and to be a carbon net zero dairy cooperative in 2050.

According to Arla's Climate Check data, 24% of the co-operative members currently produce renewable electricity from wind turbines and solar panels on their farms. As it's mandatory for farmers in Germany and Luxembourg to pass over their GOs for the green electricity to the government if their electricity production is subsidised, the share of owners who can choose to sell them to Arla is currently 14%.

The co-op estimates that around a fifth of the company's total electricity usage in its operations can potentially be covered by farmer-produced GOs.

Arla, the world's ninth largest dairy company, is owned by 9,700 farmers libing in seven European countries.

More like this

Solid result for Arla despite Covid

European co-operative Arla Foods says it has delivered financial results and branded sales volumes at the top end of expectations, despite challenges posed by Covid-19.

Featured

Sheep drench resistance costly

Analysis by Dunedin-based Techion New Zealand shows the cost of undetected drench resistance in sheep has exploded to an estimated $98 million a year.

Dairy sheep and goat turmoil

Dairy sheep and goat farmers are being told to reduce milk supply as processors face a slump in global demand for their products.

Hurry up and slow down!

OPINION: We have good friends from way back who had lived in one of our major cities for many years.

National

Govt urged to reduce ETS units

The Climate Change Commission wants the new Government to reduce NZ Emissions Trading Scheme (ETS) auction volumes as son as…

Dairy sheep, goat woes mount

Dairy sheep and goat farmers are being told to reduce milk supply as processors face a slump in global demand…

Machinery & Products

All-terrain fert spreading mode

Effluent specialists the Samson Group have developed a new double unloading system to help optimise uphill and downhill organic fertiliser…

Can-Am showcases range

Based on industry data collected by the Motor Industry Association, Can-Am is the number one side-by-side manufacturer in New Zealand.

» Latest Print Issues Online

Milking It

Papal visit

OPINION: European farmers are going to extreme lengths to have their message heard.

Thai egg tarts

OPINION: The hustle and bustle of one of Bangkok's most popular fast food outlets may feel a world away from…

» Connect with Dairy News

» eNewsletter

Subscribe to our weekly newsletter