Construction work has started on the UK’s largest bio fuel pellet production facility at Balcas‘ Enniskillen site, Northern Ireland.

The project, which together with a combined heat and power (CHP) facility represents an £8m total investment, was launched by energy minister Stephen Timms on August 23.

Mr Timms said Balcas was making a “significant contribution” to meeting the challenge of finding new sources of energy.

The wood pellet plant will produce 50,000 tonnes of fuel annually, enough to provide the energy needs of 10,000 homes and meet all of the company’s electricity requirements.

Balcas decided to build the facilities to deal with growing levels of sawdust and woodchips, and to make the company self-sufficient.

Ernest Kidney, Balcas managing director, predicted that pellets could deliver energy for a quarter of Northern Ireland’s homes within the next decade.

He said: “Throughout Europe, timber-based bio fuel pellets already provide heat, power and price stability. Timber is a cheap and renewable resource and the bio fuel pellets industry provides a bonus of well-paid rural jobs in harvesting, production and distribution.”

On-site processing of sawdust and chips will eliminate 10,000 heavy truck journeys per year, as well as generating 2.5MW of electricity.

The Department of Trade and Industry is providing a £2m grant, while £1m is being funded by Northern Ireland Electricity (NIE) under its Sustainable Management of Assets and Renewable Technology programme. Balcas is funding the rest of the project.

The CHP plant is expected to be ready in six months, with the pellet facility taking a year.