A Lochaber wood fuel business experiencing rapid growth is to expand its operations with a new office and fuel heating demonstration centre.

Highland Wood Energy Ltd based near Fort William, is a biomass heating specialist, dedicated to providing practical solutions for domestic and commercial use. The company provides a design, installation and maintenance service for wood, log and pellet heating systems across Scotland.

Highlands and Island Enterprise (HIE) approved funding of £50,000 towards the expansion project.

With a historical reliance on fuels such as oil, gas or electrical storage heating, Scotland is now realising the benefits of turning to wood fuelled heating systems. Wood fuel is a carbon neutral renewable energy source and because it is fuelled by low grade local timber resources it can help to combat fuel poverty and reduce heating bills.

Wood fuel also creates more employment per mega watt than other renewable energy. Recently many businesses and public sector buildings have been taking advantage of what fully automated woodfuel systems have to offer.

Consideration has been given to the environmental sustainability of the new building with the demonstration wood fired heating systems heating the entire building, and thermal insulation and solar panels fitted on the roof.

Two graduate engineers have been recently taken on by Highland Wood Energy through HIE's graduate placement programme, and it is envisaged that a further four positions will be created in the short term, adding to the current workforce of 11.

Bruno Berardelli of Highland Wood Energy said: "The scale of this market is huge and we would like to capture as much of the share as possible. Investment in wood heating ensures lower heating bills, reduced carbon emissions and helps to strengthen the local economy. We are excited by the interest in wood fuel technology. The demonstration centre will be used to provide training to our partners, based nationwide, and to demonstrate wood heating technology to anyone interested."

Work on the new building which will be built on land leased from Lochaber Rural Complex Ltd has commenced and should be completed in spring 2009.

Robert Muir from HIE's Lochaber area team said: "The biomass market has significant potential and although the company is experiencing rapid growth, it has been constrained because of lack of demonstration site and training facilities for installers. The new building will help the company to meet the uptake in wood fuel installations."

HIE has also this month approved funding of £8,380 to Woodtherm Ltd to develop a wood-chip drying facility. The company was established in 2004 to supply woodchips to local businesses and community buildings.

The market in Lochaber has been expanding rapidly and the development of a hot air based wood chip drying system will more than double the company's production, and ensure a consistent high quality wood chip fuel product.

Woodtherm Ltd also received assistance from HIE for the purchase of a heavy duty chipper improving the reliability of the business, expanding its customer base.