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Challenges and opportunities: Taking the Scotch whisky sector beyond compliance

28 June 2019

Last autumn, the Scottish Environment Protection Agency (SEPA) launched its first Sector Plan for one of the biggest industries in Scotland: Whisky. This sector plan is not about implementation, because all but a small number of distilleries in Scotland fulfil their obligations, says Paul Guppy of DPS Group. This is about a new key phrase which is becoming increasingly important, moving beyond compliance.

Image: Shutterstock
Image: Shutterstock

SEPA identified the special opportunities opening up: “The sector plan focuses on unlocking the potential of beyond compliance opportunities, building on the exceptional performance of the sector by achieving above 90% in SEPA's Compliance Assessment Scheme four years in a row, while tackling the remaining compliance issues.”

The Scotch Whisky sector is of prime importance to the country’s economy. It is responsible for over 10,000 jobs, with a further 40,000 supported across the UK. For example, some 90% of grain used in the whisky-making process comes from UK farms.

There are currently 20 million oak casks lying maturing in Scotland at 126 distilleries. Over a third of these distilleries are planning or undertaking new developments. The whole environment must be managed extremely carefully because of the hazards inherent in the manufacturing process, from the grain to distilling, cask filling, maturation and storage, right through to bottling.

The actual number of distilleries is growing; up over 10% in five years and it should rise by almost the same again in the next 12 months.

I could use the word booming, but when it comes to this high hazard industry, that might be an unfortunate term to use.

In its Sector Plan, SEPA says: “compliance is not up for discussion”. This is recognised by most whisky companies - the best have always recognised the need for the highest standards of safety and quality in the workplace.

Now, we are seeing a new trend; a focus on the value that this approach can bring to a business, both on and beyond the bottom line.  Rather than seeing compliance as a necessary cost, businesses are seeing that compliance and efficiency can drive productivity and profitability.

This evolving approach is not just about making more, but wasting less, being effective with resources and minimising risks – going beyond necessity to grasp a raft of new opportunities, including in the fields of safety, environmental integrity and profitability.

In practice there are several areas where the Scotch Whisky Industry are signed up to achieving beyond compliance, which SEPA recognises.

For example, improving water efficiency by 10% will have a significant environmental advantage, but will also improve the bottom line. Water costs in so many ways.

Energy is also vital. SEPA reports that 85% of energy in distilleries is used to generate heat for the distillation process and to heat buildings.

Installing an Anaerobic Digestion Plant enables the company to recover energy from the waste created by the distillation process, reducing costs and potential discharges.

At North British Distillery in Edinburgh, for example, we expanded their Anaerobic Digestion facilities installing a water treatment plant to clean effluent, allowing for 40% of water to be recycled with the remainder being discharged to the local sewer.

We then installed a gas engine to produce electricity from the biogas produced by the Anaerobic Digestion reactors.

This investment resulted in improved effluent quality, lower effluent charges, biogas used for electricity and steam generation, reduction in water usage, reduced energy costs, and the reduction in waste output load from plant.  A good example of going beyond mere compliance to create opportunity and efficiency.

When it comes to ATEX hazardous area testing, things are also changing.

Image: DPS
Image: DPS

Traditionally, regular testing has required significant resource. Tens of thousands of tests often need to be carried out, often by large teams of staff in what feels like a never-ending process.

At a Shetland Gas Plant some years ago, 45 of our engineers racked up 120,000 hours of testing, conducting 75,000 inspections on site-wide electrical, instrumentation and telecom packages.

This time around? Things would be different because we have introduced digital ATEX inspections with reports, actions and records all directly uploaded to a cloud-based register live from handheld terminals carried by the engineers.

Going paperless feels a bit last decade, but the technology is now available to make risk-based assessments as a part of the inspection process and to streamline the process and to take a smart and compliant approach to inspection frequency for each device.

There is no explicit requirement for a company’s ATEX regime to be digital or paperless, but surely solutions which go further, and improve commercial outcomes are a no brainer.

Readers will know all about ATEX 137, the European directive which became mandatory for all relevant workplaces on 1st July 2006, which seeks to improve the safety and health protection of employees at risk from potentially explosive atmospheres.

The digital system that we have adopted is built on a data management software platform enabling us to proactively manage hazardous area testing and inspection processes by performing mobile inspections on-site using ATEX certified Android tablet devices.

The whole process is designed to manage electrical and non-electrical inspections in potentially hazardous areas, providing for immediate access to data, early warning signs of equipment failure and immediate cost and time savings.

This is another example of how the beyond compliance culture is becoming more important as data helps businesses to make smart decisions based on evidence and in real time.

Each distillery has its own unique way of making whisky, which can present challenges for compliance inspection engineers. Despite this, there are a number of common areas that distilleries need to consider when preparing their inspection regime. 

Providing a complete solution which can be implemented throughout the entire process is key to a joined-up approach.

The process starts in the grain handling areas where equipment for grain silos, transfer conveyors and instrumentation within Zones 20, 21 and 22 must be checked.

It then moves through different stages to spirit handling and storage where the area classification would include Zones 0, 1 and 2, so there is a need to cover all protection concepts under IEC60079 standards.

Some of the common misunderstandings about compliance in the distilling industry include how often you need to inspect your equipment. 

Image: DPS
Image: DPS

Traditionally, there have been regular, scheduled full site inspections or a rotating schedule of inspections working their way around like painting the Forth Rail Bridge.

In reality, a bespoke digital system can optimise the inspection regime by implementing Risk Based Inspection (RBI) scoring techniques. These techniques can not only be applied to the inspection, but also to manage the remedial action strategy.

This approach to managing the DSEAR register optimises both the inspection and repair strategies which support cost control and maintenance management processes.

New solutions to make distilleries safer – and more effective, to reduce waste, improve energy efficiency – are all part of the overall mix that will shape the future of the sector.

Standards of health, safety, environment and quality are only going one way. As sectors like whisky become stronger so does the need to unlock value from a beyond compliance approach.

That is why we can be sure that companies who ready themselves by turning compliance into an opportunity rather than merely a legislative requirement are likely to be the winners.

Loch Lomond Distillery case study

Project Overview

Loch Lomond Distillery was commissioned by the Littlemill Distilling Company in 1964 with first distillation in 1966. In 1984, the distillery closed - or fell silent, to use the traditional term.

Fortunately, Alexander Bulloch and the Glen Catrine company acquired the business and resumed malt production in 1987. Grain whisky production began in 1993 and two new malt stills were added in 1999.

Challenge

Loch Lomond Distillery faces unique challenges because of the extensive nature of the site. Like all distilleries they must also meet the very high standards demanded of the Scotch whisky industry.

The team at Loch Lomond Distillery wanted to ensure that they not only met the requirements for IEC60079, but also set an example of best practice by going beyond the legislative requirements, or beyond compliance.

To do this, DPS Group worked with the distillery to introduce a fully compliant paperless ATEX Inspection system, which would be accessible by all relevant staff. The previous approach was cumbersome and potentially unreliable.

Image: DPS
Image: DPS

Managing thousands of ATEX rated devices and the ability to easily distinguish between intrinsically safe and other protection concepts was particularly important to the management team.

Importantly, downtime was to be minimised. Ultimately the Loch Lomond Distillery management team were looking at a long-term solution which would minimise ongoing costs at a time when demands on compliance are continuing to rise.

Solution

DPS Group introduced a paperless inspections system, supported by a new circuit identification standard, to Loch Lomond distillery.

Our system provides live, real-time reporting and asset management, ensuring that staff are always ahead of the curve by implementing an inspection schedule that can be managed based on risk.

In Detail

The paperless ATEX system we used for Loch Lomond Distillery allows clients to streamline administration, with a potential to save up to 40%.

As part of the set-up, our team conducted a comprehensive site survey, building up an accurate asset register giving a clear picture of the equipment across the entire site.

A tailored inspection package was devised for management approval, after which our team then began inspections based on a clear understanding of the areas of priority and high risk.

Whilst this was being carried out, each asset underwent an independent risk assessment resulting in a reinspection schedule based on condition, location and risk.

This bespoke schedule should allow cost reductions in future years without comprising safety.

Using a completely digital asset register means that information is always up to date, and always available because it is updated in real-time. This is useful for identifying problems earlier, and better planning schedules for remedial works.

Our system supports root cause analysis to determine common faults. We can then help clients plan in when issues could arise. Such an approach has an immediate benefit in terms of increased productivity.

About the author

Paul Guppy is Project Director at DPS, the UK-based integrated Electrical, Instrumentation & Control provider. Originally trained as an Instrument Service Engineer, he now manages service and maintenance contracts as well as customer support on projects from design to completion.


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