Macallan whisky distillery set to benefit from £74m green energy project

The publicly-funded lender is to join the infrastructure investor John Laing in investing £26m into the combined heat and power project, alongside £48m debt to be raised from the bond market and guaranteed by the Treasury, which will provide steam to the Macallan distillery at Craigellachie in Moray, Scotland.

It is expected to generate 87.4 GWh of renewable electricity per annum and 76.8 GWh of renewable heat, with carbon savings equivalent to taking more than 18,000 cars off the road.

The project, developed by Estover Energy, is expected to create 100 construction jobs and 23 permanent posts, and will also provide 90% of all steam required by Macallan.

According to the GIB, the plant will be fuelled with sustainable forestry by-product sourced locally from one of the UK’s most productive forestry areas.

Business Secretary Vince Cable said: “With £3.8bn of funding the UK Green Investment Bank has been set up to help businesses make the transition to a green economy right across the country.

“This investment in Speyside will not only help secure jobs, boost a vital industry and support the local supply chain but also generate renewable energy for homes in Scotland.”

Chief Secretary to the Treasury Danny Alexander also welcomed the announcement.

He said: “The Speyside guarantee is fantastic news for Scotland’s economic future.

“Today, over £1bn of infrastructure projects have now been brought forward as a result of the UK guarantees scheme and £36bn worth of projects are pre-qualified.

“Our action is creating the right conditions for more investment in our infrastructure and helping to build a stronger economy.”

Green Investment Bank chairman Lord Smith of Kelvin said that the project was a great example of the “wide ranging benefits of renewable energy”.

The Macallan plant is one of a number of biomass energy plants at distilleries to get backing from the GIB. The GIB recently put forward £5m of funding for the Balmenach distillery in Speyside, which will support the installation of a new biomass boiler to replace the original heavy fuel oil boiler.

The GIB has also provided funding for biomass boilers to be installed at the Aberfeldy distillery in Perthshire and the Tomatin distillery near Inverness.

Liz Gyekye