Since 2018, “Dairy Distillery” in Ontario, Canada, has been turning a waste byproduct of cheesemaking into vodka and cream liquors. Now, the company will help members of the Michigan Milk Producers Association (MMPA) turn their waste into biofuel.
The MMPA is a farmer-owned cooperative of over 1,000 dairy farmers in Michigan, as well as Indiana, Ohio, and Wisconsin. MMPA partnered with Dairy Distillery to build a plant to process its milk permeate – the lactose and minerals remaining after milk undergoes filtration – into as much as 2.2 million gallons of ethanol per year.
The new venture includes plans to refurbish the 30,000-square-foot Constantine facility, which produces around 14,000 tons of milk byproduct annually for animal feed. The milk permeate will be piped from the existing processing plant directly into an 8,500-square-food ethanol plant, where it will be fermented using Dairy Distillery’s technology. The ethanol production is estimated to offset some 14,500 metric tons of carbon a year, in turn reducing the carbon footprint of the milk processed at the facility by -5%.
Dairy Distillery founder and CEO Omid McDonald, a self-described “serial entrepreneur,” says he became interested in other uses for dairy when his cousin Neal McCarten – now a partner in Dairy Distillery – described how his uncle’s dairy farm was dumping skim milk.
McDonald had already been working on making moonshine, something he became interested in after visiting a micro-distillery in Charleston, South Carolina. “I ordered a pot still kit. Let’s say I made nothing tasty.” But it was that obsession that guided him to the question, “Can you make booze out of milk?”
Needless to say, McDonald’s early inquiries caused some confusion. When he applied to the Canadian Dairy Commission’s innovation program, “They said we should “find another source” other than skim milk.” McDonald said he called nearly every Ontario dairy processor, and most hung up on him. “But a woman at Parmalat introduced us to milk permeate,” explains McDonald. “I discovered that this waste product is an issue in Canada and around the world, and is a huge problem for the environment.”
To deal with excess skim milk, dairies created a product called “ultrafiltered milk.” The ultrafiltration process concentrates milk proteins, making cheese manufacturing more efficient and lowering transportation and storage costs for the concentrate. But the process also creates the waste product permeate that can be harmful if not disposed of properly. Disposal is also costly for dairy producers.
Milk permeate is “just sugar, water and minerals, so it’s a lot like molasses for rum distillers,” says McCarten. “Dairies are trying to concentrate this waste and minimize the volume. It makes a perfect substrate for us.”
McDonald and McCarten then worked with a professor in the University of Ottawa’s biology department to perfect the process of converting milk sugar into spirits. The result was “Vodkow,” a lactose and sugar free vodka that touts “hints of vanilla.” The distillery also has a line of flavored cream liquers. During the Covid-19 pandemic, Dairy Distillery transformed its operation to produce hand sanitizer.
McDonald’s Vodkow ended up drawing the attention of the Michigan Milk Producers Association The initial plan was to turn MMPA’s milk permeate into vodka, but that would have added up to some $54 million worth. “There’s only so much vodka people can drink,” McDonald said. So they started looking at what other high-volume uses there might be, which led them to biofuel.
Ethanol production at the new $41 million Constantine plant is planned for early 2025. The project received $2.5 million in funding from the Michigan Strategic Fund and has more coming from the Inflation Reduction Act and a tax break. Learn more about Dairy Distillery HERE. (Sources: CVC, Crain’s Detroit, Alberta Farmer)
