Fundraising

Equitix, GIB fund biomass boiler at whisky plant

The deal, at the Tomatin Distillery near Inverness, represents the UK Green Investment Bank’s first investment in Scotland.

-

A fund managed by Equitix, in which the UK’s Green Investment Bank (GIB) is the cornerstone investor, has financed the installation of a biomass boiler at the Tomatin whisky distillery near Inverness in Scotland.

The Energy Saving Investments (ESI) fund is committing £576,733 (€669,887; $881,594) to the project, backed up by a further £600,274 from the Equitix Energy Efficiency Fund (EEEF), which makes investments in energy efficiency, including as a co-investor alongside ESI. The investment therefore totals around £1.2 million.

A statement from GIB said the investment was being made alongside Balcas Limited, a UK manufacturing firm which will provide wood pellet biomass for the boiler from its managed forests in Scotland.

The boiler will produce steam used in the production of whisky and will replace 80 percent of the heat load generated by a high maintenance, inefficient oil-fired boiler. GIB says carbon dioxide emissions are expected to be cut by more than 96,500 tonnes over the 20-year life of the investment.

For GIB – which opened for business in November 2012 and manages around £3.8 billion in government money – the deal represents its first investment in Scotland. This has a particular significance, since the organisation is headquartered in Edinburgh.

“We have a strong pipeline of investments in Scotland and hope to be able to announce further investments in Scottish distilleries, as well as other projects, very soon,” said GIB chief executive officer Shaun Kingsbury in a statement.

In its annual report GIB said that, as at June 2013, it had invested £635 million in 11 transactions in the energy efficiency, offshore wind, waste recycling and waste-to-energy sectors. The bank said an additional £1.6 billion had been mobilised from the private sector.

The £50 million ESI fund was awarded to Equitix by GIB after a competitive process. The fund’s maiden deal came in May this year when it committed £4.9 million to replace inefficient heating systems with biomass boilers through around 60 projects across the UK. EEEF co-invested £5.1 million in the deal.