Nestle Turns Milk Into Water as California Drought Rages

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Nestle's Carnation Milk Production in Modesto

Cans of Carnation evaporated milk move along the production line at Nestle SA's factory in Modesto, California.

Photographer: Judy House/Nestle via Bloomberg

Nestle SA, facing protests in drought-stricken California for bottling water, is spending millions to turn wastewater from milk into a liquid it can use to clean up its factories -- and burnish its corporate image.

The U.S.’s largest water bottler is installing new filtration systems at a plant in Modesto, 90 miles east of San Francisco, so it can reuse waste left over from making Carnation condensed milk rather than pour it down the drain. The treated liquid will be used for cleaning and cooling instead of local freshwater, according to Jose Lopez, head of Nestle’s operations.

“We’re not going to greenwash you,” Lopez said in an interview in his office in Vevey, Switzerland. “It doesn’t make economic sense to do this, obviously. The drought this year is teaching us you have to think of ways to adapt. What seems today not fully advisable from an economic standpoint will become a necessity.”

The move bolsters Nestle against criticism as California endures a fourth year of drought. A group of as many as 24 protesters with plastic pitchforks blocked the entrance of Nestle’s water-bottling facility in Sacramento for half a day in March and the company stopped sending trucks in and out. More than 82,000 people have signed a petition asking Nestle to stop bottling from a spring in southern California.

The Carnation factory’s $7 million revamp will reduce water usage by 71 percent when the first phase is complete next year, Lopez said.

White Water

The plant will save about 63 million gallons a year, the equivalent of 9 percent of the water Nestle uses in the state to produce under the Arrowhead and Pure Life bottled-water brands. The upgrade is part of the Swiss company’s plan to reduce the water it uses globally by 40 percent in the 10 years through 2015.

The Modesto project is similar to a factory Nestle renovated last year in the Mexican town of Jalisco. That plant is entirely water free, recycling liquid that’s left over when milk is dried into Nido brand powder.

Nestle’s bottled-water operation has been a particular target of protests.

“It’s the worst drought we’ve seen in a long time, and it’s irresponsible of the state to allow Nestle to bottle water that’s supposed to be a public resource,” said Adam Scow, California director at Food & Water Watch, a non-profit organization. “We’re calling for a moratorium on bottling water for private profit.”

While Starbucks Corp. said May 7 it would stop sourcing Ethos water from California and shift production to Pennsylvania, Nestle rejects the notion it should stop bottling in California because of the drought. The Swiss company uses 4 million cubic meters of water in the state each year, less than 0.008 percent of California’s total use.

Not Everywhere

“Hydration is absolutely necessary,” Lopez said. “The reason why this thing exists is because there is urbanization. People are moving around, and the infrastructure does not supply you with water at every point.” Improvements this year at its water plants in the state will cut usage by almost 8 percent a year, Nestle says.

Lopez said agriculture has more potential to save water than Nestle. One kilogram of meat requires thousands of liters of water, and better irrigation practices represent the biggest potential savings, according to the executive.

“Bottled water is the easy one to see,” said the 62-year-old, who has worked almost four decades at Nestle. “It’s nearby you, it has a brand. Water is very emotional. You cannot escape from that. We have to understand people.”

Nestle is also starting a project to reduce water usage at ice cream plants in Bakersfield and Tulare by 12 percent by using bacteria to digest wastewater to make it fit for use in refrigeration. The company also plans waste-water treatment projects in South Africa and Pakistan.

“We shouldn’t be bottling water, and we should look at the other uses of water as well, like soda and certain crops, or the crazy amount of water that goes into watering golf courses,” said Eddie Kurtz, Oakland-based executive director at Courage Campaign, a non profit organization.

Nestle is urging governments to improve aqueducts and reduce incentives to waste water. Big water users are likely to increase pumping if they expect mandatory cuts are coming, which is a counter-incentive, Lopez said.

“In California, the infrastructure is not there,” Lopez said. “You’re not going to look at me and make me responsible for that the infrastructure is not there to cope with the situation today, are you? It’s easy to demonize something like that.”

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