UPDATE 1.00pm:
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Police have arrested a 46-year-old man after it is alleged a hydroponics set up and cannabis plants were found after a blaze in Nerrina.
Monday's 5.20pm fire destroyed two neighbouring sheds at Sunset Terrace properties - with acrid smoke visible across Ballarat.
Officers investigated the first shed where the fire started and said a Nerrina man was expected to be charged on summons with cultivating and possessing cannabis.
The neighbours' shed, which was also destroyed, when the fire spread from the grow shed was not implicated in any way in the cause of blaze and is not under police investigation.
Anyone with information that could assist police with their enquiries is urged to contact Crime Stoppers on 1800 333 000 or submit a confidential report online at www.crimestoppersvic.com.au
UPDATE 7.45am:
The CFA said the State Duty Officer has organised for the Fire Investigation Unit to check out the Sunset Terrace blaze today (Tuesday).
EARLIER:
Multiple firefighting crews are currently battling a shed fire in Nerrina that threatened to spread to a nearby home.
The fire began on a property on Sunset Terrace shortly after 5pm and four firefighting units were despatched.
A large tin shed was engulfed when they arrived and flames up to five metres high could be seen from the neighbourhood, along with a plume of smoke across the wider area.
Firefighters wearing breathing apparatus brought the fire under control shortly before 6pm.
The house and nearby trees appear to have escaped damage.
It is now known if anyone was in the shed at the time or if there were any injuries sustained in the fire.
Ambulance Victoria were called to the fire incident in Nerrina at around 5:50pm..
Paramedics were on standby for health monitoring but Ambulance Victoria were not releasing any more details at this stage.
Nine CFA units are also responding to a structure fire in Log Cabin Lane in Carngham which was also reported shortly after 5pm on Monday.
That fire was first reported at 5.20pm and listed as under control at 6.02pm.