It is such an obvious idea for the producers of the “wee dram” that it is a wonder that no one has made it work before. Later this year Helius Energy, an AIM-listed company, begins construction on a facility in Scotland that will produce enough energy to power 14 malt whisky distilleries on Speyside, variously owned by the likes of drinks giants Diageo, Pernod Ricard and Edrington.
Helius will take the draff (the solids left over from malting the barley) and the pot ale (the gunge left over from the distilling process). After treating the residues, the product will then be used to fire up boilers to produce the energy for the distilling process. The ultimate sustainable energy cycle and a prime example of the potential of the nascent biomass energy industry. It is forecast that by 2013 when the 7 megawatt Speyside combined heat and power facility is up and running that it will produce enough energy to power 9,000 homes as well.
The Speyside project is a showcase project that will be overtaken by bigger things, says Adrian Bowles, a co-founder and chief executive of Helius. The company already has a solid track record. Two years ago it sold its original 65 megawatt biomass plant on Humberside at Stallingborough to RWE, the energy giant behind npower. That deal solidified Helius’s balance sheet with £28 million of cash and an income stream of 13 per cent of future profits over 24 years. “We generally want to be owner-operators of our biomass plants but ultimately we are not going to turn down offers we cannot refuse,” Mr Bowles said.
The company has a solid pedigree Keith Henry, Helius’s chairman, ran the privatised electricity generator National Power before it was taken over by RWE a decade ago.
Its leading shareholder — with about one-sixth of the company — Angus MacDonald is a leading investor in green technologies and timber after making an estimated £72 million from the sale of London Financial News and its eFinancial online arm to Dow Jones three years ago.
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The next Helius project is a £300 million, 100 megawatt woodburning facility at Avonmouth. “It will be Britain’s largest biomass plant when it is finished,” said Mr Bowles, a chartered engineer who began his career in the pre-privatisation Central Electricity Generating Board.
Avonmouth has gained its planning consents and construction could start next year. While the Avonmouth plant may seem expensive for the amount of energy it will produce — enough to power about 150,000 homes — biomass facilities get three income streams: the price of the energy they produce plus the subsidies from renewable obligations and levy exemption certificates. “Put simply,” says Mr Bowles, “we will get twice as much in revenues compared to an equivalent gas-fired power station.”
Avonmouth will be fired by recycled timber and the bark, offcuts and chipping from sawmills sourced from Britain and Europe. “The key is that we retain our sustainability criteria,” he said.
Helius is sourcing its boilers and turbines from suppliers to similar-sized projects up and running elsewhere in the world. “There are plans for 300 megawatts biomass plants in the UK but for us that would be a technology challenge. We are going with proven technology, proven on 100 megawatt plants. That is all about managing the risk in the company. We are a project management company employing clean technology.”