Diageo whisky business going green in Kentucky

Spirits giant Diageo Plc announced on Monday that it is going green with its newest whiskey-making venture in the Bluegrass State of Kentucky.

Its distillery being built at Lebanon, Kentucky, is expected to be carbon neutral – a first for the London-based company. The US$130 million distillery of Bulleit bourbon is expected to be fully operational in 2021.

The site will be powered by 100 per cent renewable electricity, with a capacity to produce up to 10 million proof gallons per year – or 3.8 million 9-litre cases, the company said.

“As a company, we know that our long-term sustainable growth depends on reducing our reliance on fossil fuels that contribute to climate change,” said Perry Jones, president of North America Supply for Diageo. “This groundbreaking undertaking to electrify our operations and then power them with renewable electricity will result in one of the largest carbon-neutral distilleries in North America.”

The new distillery moves the company closer to its goal of sourcing 100 per cent of its electricity from renewable sources by 2030, it said. The renewable electricity will be supplied by Inter-County Energy and East Kentucky Power Cooperative, it said.

Diageo said that it plans to incorporate several features to achieve carbon neutrality. Together, they should avoid more than 117,000 metric tons of annual carbon emissions, equal to taking more than 25,000 cars off the road for an entire year, it said.

The operation will include a 72,000 square-foot distillery, a dry house, and warehouses, eventually employing 30 full-time workers.

The distillery will use electrode boilers rather than fossil-fuel-fired boilers. Exterior lighting will be solar powered, and all interiors will use LED lighting, the company said.

Interior lighting in warehouses, where the whiskey matures, will only activate during loading or unloading work, and lowered roofs will minimise heating and cooling needs, it said.

Kentucky Governor Andy Beshear applauded Diageo’s commitment to carbon neutrality, calling it “a notable example of a historic Kentucky industry embracing a new future”.

Kentucky distillers produce about 95 per cent of the world’s bourbon supply, according to the Kentucky Distillers’ Association.

Diageo has invested more than US$500 million in Kentucky since 2014.

The new Lebanon distillery, about 65 miles (105 kilometres) southeast of Louisville, is on the southern tier of the state’s main bourbon production belt in central Kentucky. It reflects Diageo’s deepening commitment to bourbon production. The plant will supplement the company’s Kentucky operations at the Stitzel-Weller distillery in Louisville and its distillery at Shelbyville.

Diageo’s other spirits brands include Johnnie Walker, Crown Royal, Smirnoff, Ketel One, Captain Morgan, Baileys, and Guinness.

AP