Swiss dairy producer Emmi has unveiled plans to become a "greener" supplier by using wood chips to power its factory.

Emmi is constructing an eco-friendly wood chip plant to generate steam and save 1.6 million litres of heating oil per year. The company currently uses 32,000 tonnes of steam at its site in Emmen. The new wood chip plant is expected to produce 22,000 tonnes of steam per year when it comes online in May. At busy periods the existing steam plant would fill the shortfall, said the company. However it will now be powered with natural gas rather than heating oil.

The £2m project is part of a long-term environmental aim to reduce CO2 intensity to 79% by 2012 and increase energy efficiency by 12% compared with 2000. The company was on target to exceed those goals, it said.

Emmi produces a range of products from its base in Switzerland, including cheese, yoghurts and other potted desserts.