Blue Lake Milling's bioenergy breakthrough set to power plant, nearby homes

EXCITING: Biogass Renewables project manager Ross Merchant (left) and Blue Lake Milling commercial projects manager Jeremy Neale affront the new $8.1 million biogas plant in Bordertown. Photo: Supplied.
EXCITING: Biogass Renewables project manager Ross Merchant (left) and Blue Lake Milling commercial projects manager Jeremy Neale affront the new $8.1 million biogas plant in Bordertown. Photo: Supplied.

Blue Lake Milling will be able to offset almost all its monthly energy costs through converting oat husks into electricity.

The company completed construction of its $8.1 million biogas plant last week. The plant will generate enough bioenergy to power both the plant and nearby homes.

"Two-thirds of it will go to the mill, and the remaining third will be put back into the grid," Neale said. "It'll go a fair way to eliminating our electricity bill," commercial projects manager Jeremy Neale said.

Mr Neale said issues with power reliability resulted in a need for an alternate source. Fast-forward more than a decade, and the mill's current monthly invoice totals around $80,000.

Another benefit of the new biogas plant, is that it will allow manufacturing to continue in the event of a power outage.

Since the Bordertown branch was established in the 1980s, it has provided countless employment opportunities. It currently employs 120 people.

The mill processes more than 24,000 tonnes of oat husks each year as a by-product of its production. Originally, the husks were sold as stock feed, used as packing material or were thrown away.

Through anaerobic digestion, the new biogas plant converts the husks into bioenergy, which involves microorganisms breaking down biodegradable material.

The subsequent biogas created is a mix of methane gas and carbon dioxide, which fuels an onsite generator to produce electricity and heat to power the oat mill.

Blue Lake Milling received a $25,000 grant to undertake an energy efficiency study in 2017, and one year later, it received $20,000 from the State Government to fund a full feasibility study for the project.

Following its success, the oat mill secured a further $2.5 million in State Government funding through the Energy Productivity Implementation Grant Program, before beginning construction in 2019.

Biogass Renewables was contracted for the design and will operate and maintain the facility.

Despite anaerobic digestion plants being common throughout Europe, the Bordertown-based plant is one of just five plants located in Australia.

Mr Neale spent two weeks at a workshop in Germany to better understand of how to operate a biogas plant. He said Blue Lake Milling's ambitious plan was met with scepticism.

"They all told us we were crazy," Neale said. "There's existing plants with oat husks being fed in but none with it as a straight diet. So it was obviously a bit of a risk."

To improve its environmental footprint further, the branch is transitioning from gas-powered forklifts to electric models, while also exploring further opportunities to reduce its waste impact.

CBH, the parent company of Blue Lake Milling, will also use the new project to gauge the potential to implement similar systems at its other grain operations throughout the country.

Blue Lake Milling chief executive officer Kevin Boyle said that while the new plant would see some business savings, the improvements to sustainability were what got the project over the line.

"The return on investment in financial terms actually remains very low," Boyle said.

"For businesses like ours if it was only a financial decision we would likely not commit to it.

"This is a representation of the values of our whole organisation, this is real leadership in industry, and planning for a better future."