Biomass CHP to power Scottish distillery

John Laing and the UK Green Investment Bank (GIB) are to invest in a new £74m green energy facility in Speyside, Scotland developed by Estover Energy Ltd.

The new biomass combined heat and power (CHP) plant near Craigellachie, Moray, will generate 87.4GWh per annum of renewable electricity – enough to power more than 20,000 homes. It will also generate 76.8GWh per annum of renewable heat.

The new CHP facility will contribute to reducing the cost of energy at The Macallan distillery by providing around 90 per cent of all of the steam needed in the distillation process. By using biomass instead of natural gas to generate heat, the distillery will reduce its greenhouse gas emissions by over 17,500 tCO2e.

John Laing and GIB intend to make a £26m equity investment in the project. The remainder of the funding, in the form of debt, will come from a bond to be issued by the project company and listed on the London Stock Exchange. When issued, the bond will be guaranteed by Infrastructure UK, part of HM Treasury. GIB and John Laing’s investment is conditional on the successful conclusion of the bond process.

The project is being developed by Estover Energy, an Edinburgh- and London-based SME specialising in developing biomass CHP projects. The plant will be fuelled with sustainable forestry by-product sourced from the local area, one of the UK’s most productive forestry areas. A consortium of local growers and forest industry suppliers including Stobart Biomass Products Ltd. and UPM Tilhill will supply the plant.

Marcus Whately, co-CEO of Estover Energy, said: “The Speyside project is the first of four similar projects that bring together some of the most respected names across several industries. The result is low-carbon energy for British industry, creation of rural jobs and a major infrastructure investment for this part of Scotland.”