Australia's dairy manufacturers have invested more than $27 million in environmental sustainability projects over the past three years, a new report has found.

Australia's dairy manufacturers have invested more than $27 million in environmental sustainability projects over the past three years, a new report has found.

The report, Australian Dairy Manufacturing Industry Sustainability Report, 2007/08, was produced by Dairy Australia on behalf of the Dairy Manufacturers Sustainability Council.

Assessing dairy manufacturing's overall environmental performance at 52 of the nation's 57 manufacturing sites, it found more than $2.5 million had already been saved as a result of these projects.

The benefits to the environment were also impressive, with savings of more than 6000 tonnes of green house gas emissions.

The report looked at several key environmental impacts, including energy, water and chemical consumption and the production and disposal of solid waste, packaging and wastewater, and compared these to a benchmark survey from 2004/05, the State of the Environment Report 2005.

A five per cent reduction in fresh water required for every litre of raw milk produced was one of the many improvements highlighted.

Recycled water usage, meanwhile, increased from 15 to 26 per cent due to the adoption of reverse osmosis systems to recover water, while the generation of wastewater for every litre of raw milk processed fell from 1.6 to 1.5 litres, 47 per cent of which was used for irrigation in 2007/08.

Dairy Australia Managing Director Mike Ginnivan welcomed the release of the report, which he said was a product of successful collaboration.

"The Dairy Manufacturers Sustainability Council is to be commended for creating a vehicle for industry competitors to work together on solving common problems," he said.

"Despite competing for milk supply and for market share in domestic and overseas markets, these companies are sharing their challenges and successes in environmental management."

Mr Ginnivan said while the Federal Government's proposed Carbon Pollution Reduction Scheme and other national initiatives posed multiple challenges to Australian dairy manufacturers and producers, the industry was well poised to meet these.

"The 2007/08 Sustainability Report is just one way in which the dairy industry is seizing the initiative to work together on solving common problems so that all dairy manufacturers can maximise their ability to reduce their environmental footprint."