Corporate social responsibility may be the buzzwords on everybody’s lips, as green issues hit home with bakery manufacturers. But while some companies are ebbing with the tide of public opinion, others don’t need a gun to the head to bring sustainability to the forefront.

Due to its remote location in the north of Scotland, Macphie already employs an environmental manager and has a range of targets, including energy and water usage, packaging reduction and reducing waste to landfill. Chief executive Alastair Macphie says he’s been "spraying sludge" over his estate for years, an image not as horrifying as it first appears.

"We’re always looking at more sustainable ways of doing what we do because of our rural setting. Fortunately, they are always the more cost-effective ways," he says.

Yet plans to more than double Macphie’s energy usage, to 1,500-2,000kVA by 2011, along with long-term growth in the business, uncovered massive problems with the creaking rural infrastructure. After calling in the electricians, the company discovered the old wiring wasn’t up to the job. Scottish & Southern, which provides overground power cabling, linking the site to the grid, quoted between £0.5-0.75 million for new cabling to cope with the demand.

"They took one look and said the cabling was never designed for a business of our size," says Macphie, who balked at the jaw-dropping quote. "So we said, ’How can we utilise what we have here as farmers, as well as food producers, to come up with a combined heat and power plant?’"

Energy consultants advised against installing a combined heat and power biomass plant. Instead, a grant from the Scottish Executive’s Scottish Biomass Support Scheme buttressed a £1.5m investment in a biomass plant - a boiler fuelled by wood chips to provide just the heat for its factory on the 2,000-acre family-owned estate. The plant, due to be operational by summer 2008, is part of a renewable energy plan that will cut carbon emissions by 2,000 tonnes annually.

Initial feasibility of the plant calculates a payback within five to six years, based on an oil price of $65 a barrel. Now that oil prices have jumped to $86 a barrel, the payback will be quicker. The cost of wood chips does fluctuate with the price of oil, but only marginally, says Macphie. "The nearby sawmills have been looking for an avenue to get rid of their ’waste’ - the bark and shortcuts. To chip it and move it three miles to us is a godsend. And between 5-10% of the annual total will come from our own farm."

But storing the 5,000 tonnes of chips needed per year to power the plant presented a problem: to safeguard for contingencies, the firm needed a week’s worth of wood chips, or 100 tonnes, stored on-site. "That occupies quite a big area; that’s where oil beats wood chips hands down!"

Machphie’s combined heating and power bill now totals £0.75m, but electrical usage has been reduced by 20% over the last three years and a feasibility study to tac-kle power needs, with sources such as wind turbines is under way. n