A Scottish company has developed a commercial scale method of producing biofuel capable of fuelling cars from the unwanted residue of the whisky fermentation process. Edinburgh-based Celtic Renewables developed its process of producing biobutanol at industrial scale in Belgium and was recently awarded a £11m ($16.7m) grant by the British government to build a bespoke facility of its own in central Scotland.

Professor Martin Tangney founded Celtic Renewables in 2012 as a spin-off company from Edinburgh Napier University. Tangney's team re-adapted a fermentation process called Acetone-Butanol-Ethanol (ABE) originally used 100 years ago, but abandoned due to the cheaper cost of petroleum at the time.

Tangney's ABE process involves blending pot ale and draff - two residues that make up 90 percent of the distillery output. Draff consists of the sugar rich kernels of barley which are soaked in water to facilitate the whisky fermentation process, while pot ale is a yeast liquid that contains copper and is left over after distillation. Scottish distilleries produce around 750,000 tonnes of draff and 2bn litres of pot ale every year.

"In the production of whisky less than ten percent of what comes out in the distillery is actually the primary product," said Tangney. "The bulk of the remainder are these unwanted residues - pot ale and barley. What we can do is combine these two together, create a brand new raw material, apply a different fermentation technology and convert the residual good material in here into high-value products and in particular this - biobutanol, which is an advanced biofuel which is an exact replacement for petrol or diesel."

Until now much of the focus on non-oil based fuel has been on ethanol, which can be produced from plants such as sugar cane or corn. However, ethanol production is controversial, partly because it relies on taking plants out of the food chain. According to Tangney, biobutanol is far more environmentally friendly and also more efficient.

"Butanol, which is our fuel, is an advanced fuel that's a four carbon alcohol, so inherently it has more energy, it has almost the same amount of energy as petrol, whereas bioethanol has only got 70 percent of it," he said. "You can store it and pipe it and use the existing infrastructure to distribute this, and in fact you do not need to modify an engine. So this is a genuine like-for-like substitution for oil or diesel - and moreover the fuel is not restricted to automobiles. It's currently being trialled in shipping industry and is a very good base unit for jet fuel."

Tangney says there are huge opportunities for using the ABE technology to produce biobutanol from a variety of spirit drinks.

"This is the first of our opportunities and we're currently working specifically with the malt whisky industry. Then there's the grain whisky industry, there's international whisky industries, Ireland - where it all originated - Japan, India, America. There are huge whisky industries all around the world, and then there are related drinks industries. And we're currently going through a pipeline of research and development where we're looking at a whole wide variety of unrelated products that will also fit into this, so we're attempting to tap into regional, national, international resources of low value or unwanted biological material," he said.

Tangney insists oil companies should not fear his company's innovation. "I see the whole energy thing as a matrix where there will be lots of different renewable energy forms coming in to replace oil, which won't happen like-for-like overnight," he said. "For me butanol should be integrated into the existing structure. We have no intention of developing a brand new infrastructure with our own filling stations and everything. We would bring it in as a blend and distribute it so the consumer sees no difference in their day-to-day activity but they are in fact helping the planet and reducing the amount of oil we consume by putting this into our cars."

Celtic Renewables believes it could become the multi-million pound market leader in the biofuel industry. The company was helped by grants from the UK government's Department for Energy and Climate Change (DECC) under its Energy Entrepreneurs Fund. It has also been aided by Scotland's Industrial Biotechnology Innovation Centre (IBIC), which encourages collaboration between industry and academia to drive innovation.

Nearly 200 nations will meet in Paris from 30 November to 11 December, to agree on a global accord to slow climate change.