30 May 2012
Heat energy for distilling is largely derived from natural gas,
fuel oil or renewable fuels, such as biomass or industry
by-products). Around 20% of the industry's energy use is
In its wide-reaching Environmental Strategy the
industry has committed to improve energy efficiency in production,
mitigate greenhouse gas emissions and source more energy in future
from non-fossil fuel sources. The aim is that by 2020, 20% of
the industry's energy requirements will be derived from non-fossil
fuels, rising to 80% by 2050.
Although the industry has a long history in taking active steps
to improve energy efficiency, the strategy established a formal
starting point in the journey to reach the 2020 and 2050
targets. Its progress report
shows that in 2008, the baseline year for the strategy, 3% of the
industry's primary energy was from non-fossil fuel.
To deliver its non-fossil fuel targets, the industry is
investing significant sums in renewable energy. A number of these
projects seek to generate renewable energy from distillery
by-products. Since 2008, over £170m has been invested at five sites
alone in renewable energy schemes such as large-scale anaerobic
digestion (AD), biomass and renewable combined heat and power
(CHP). Those projects and other investments will help the
industry meet the 2020 target.
Distillers recover and re-use heat as much as possible. But
there will always remain a quantity of low-grade rejected heat that
might be of use to third-parties. Where synergies exist with
neighbouring businesses or facilities, Scotch Whisky distilleries
have successfully offered that heat to their neighbours. This is
the case at Bowmore Distillery on Islay whose low grade heat warms
the local swimming pool, North British Distillery which heats
Tynecastle High School. Diageo's new malt distillery at Roseisle in
Moray has also successfully overcome challenges posed by its remote
location. It is in sight of an existing maltings which now takes
the distillery's cooling water to reduce energy demand for the
steeping process at the maltings.
Many distilleries are located in remote parts of the country,
away from the gas grid and rely on fuel oil as their prime energy
source. Distillers might in future be able to access
alternative fuels such as biomass, or recycled or waste oils to
fire their boilers. For this to become a long-term reality,
supply chain issues such as certainty of supply will need to be
resolved. There remains potential for technological
development in the area of alternative renewable fuel supplies and
we are aware of a number of initiatives aimed at offering new fuel
The SWA watches the development of these with interest and
try to assist such initiatives wherever possible.
A Complex Policy Landscape
Aside from the industry's own proactive agenda, distillers face
a plethora of complex and overlapping climate change mitigation
- Climate Change Levy (CCL) and associated Climate Change
- EU Emissions Trading System (EUETS)
- Carbon Reduction Commitment Energy Efficiency Scheme (CRC)
The SWA has long-called for simplification to reduce regulatory
burden and believe that our sector should be covered by a single
UKsector-wide climate change agreement.
The Association contributes actively to a broad range of
policy discussions with the UK Government whose energy policies and
incentive schemes impact on the Scotch Whisky industry. These
include the UK Low Carbon Heat Strategy, and the various financial
incentives for renewable energy generation (Renewables Obligation
(Scotland), Feed-in-Tariffs and Renewable Heat Incentive).
Climate Change Agreements - Continual Improvement in Energy
The Scotch Whisky Association manages the spirits industry's
Climate Change Agreement (CCA) on behalf of the whole spirits
sector, including gin and vodka.
These agreements were set up in 2001 and are binding agreements
with the UK's Department of Energy and Climate Change. The
industry has achieved a 25% energy efficiency improvement since
1999 and the sector
has consistently exceeded all stretching 'milestone' targets set by
A new CCA scheme is due to begin in 2013 and we are working with
DECC to help shape a workable and simpler future scheme and ensure
a smooth transition between the existing and new schemes.