A SCOTTISH start-up company has secured planning permission to build a commercial demonstrator plant at a two-acre site in Grangemouth that will produce more than half a million litres of fuel from whisky residue every year.

As The National revealed almost a year ago, Celtic Renewables will provide the next generation of biofuel – produced through biological rather than geological processes – at the plant, which is expected to be in operation by December.

The advanced fuel called Biobutanol could revolutionise sustainable transport. It is seen as a direct replacement for petrol and diesel and was used for the first time in a car last July.

Now the firm has established a new company — Celtic Renewables Grangemouth plc — to deliver the plant.

Celtic Renewables, a spin out from Edinburgh Napier University, was founded by Professor Martin Tangney, who is also its president.

“This is a very exciting time for biotechnology in Scotland,” he said. “Our plant, which will use entirely sustainable raw materials to make high value low carbon products, will be the first of its kind in the world.

“It will shine a global spotlight on innovation in Scotland in the low carbon economy.”

Company CEO Mark Simmers, said: “This is a huge step forward for Celtic Renewables as this demonstration plant will enable the roll out of the technology at full industrial scale across Scotland and internationally.

“Grangemouth is the perfect location for the plant, where we can benefit from the synergies of locating within the national petrochemical hub and work with a range of complementary partners with the full support of local and national Government agencies.”

The company will work with Tullibardine Distillery in Perthshire to derive some value from production residues of the malt whisky industry in Scotland, which produces almost 750,000 tonnes of draff, or dregs, and two billion litres of pot ale.

Last year Celtic Renewables was one of three winners of a Department for Transport advanced biofuels demonstration competition and secured a grant of £11 million, and Tangney told The National that funding for the plant was now in place.

“We got a £9m grant from the Scottish Government through its Low Carbon Infrastructure Transition Programme (LCITP) and we had to match it for a £18m project to be built at Grangemouth. We worked with Abundance in London to raise that and the rest is coming in through private sources.

“We beat their first 24-hour fund raiser by half a million pounds to it was quite impressive. That’s all in place and we’re marrying it to other funding, so as soon as that’s settled we’ll be ready to get to work with the shovels in Grangemouth.

“It’s a business innovation as well as a scientific one — we’re taking something that’s of little value to the country and converting it from no value to high value, rather than taking something that’s already worth a lot of money and trying to squeeze more out of it.”

The advances with Celtic Renewables came after Tangney was given an Honorary OBE in the New Year’s honours list: “It’s an honorary award and there have been very few Irish recipients — that is the Republic of Ireland, as distinct from UK citizens of Northern Ireland.

“I only know of a few, including Pierce Brosnan, and my wife quite likes that I’m joining him in a somewhat elite group.”