spring 23 interview centre stage

‘Net Zero’ - another climate change buzzword or is 2023 the year we all need to stand up and take action to fight carbon emissions? Tony Cleary MBE, Founder and CEO of The Lanchester Group, has led the way with sustainable practices for a number of years and can vouch first hand for the benefits of becoming a greener business. We sat down with him to find out all about his sustainability journey, ahead of his talk on the subject at this year’s Chairman’s Dinner.

You’ve been described as a ‘pioneering entrepreneur who is leading the charge on sustainable entrepreneurialism’, would you agree with that assessment?

We’re definitely in the top tier of sustainable businesses in the UK, and that’s largely thanks to our spread of initiatives. Our main focus is renewable heat and energy generation, which reduces our reliance on fossil fuels. We combine renewable wind and solar energy with geothermal heat pumps – you have to look at what’s right for each specific location and adapt. Some approaches simply aren’t appropriate in some locations, ie, we could never install water source heat pumps at our HQ in Stanley because we’re too high above sea level, nor turbines in the centre of Newcastle. But, through a combined approach we always achieve our targets.

There’s no ‘one size fits all’ solution when it comes to sustainability and no one single correct approach –what’s right for us might not be right for anyone else. We put our first wind turbine up in 2012, so we’ve been doing this for some time.

Sustainability is ingrained in each of our businesses now [Lanchester Wines, Greencroft Bottling, Bon Bon’s, Spicers of Hythe]. And, we’ve learnt lessons along the way, both good and bad, which we regularly share as good practice with other businesses.

What was it that made you take that first leap in 2012?

I was at home recovering from a hip operation when I saw an article in the newspaper about creating power from wind energy. We’re based up on a windy hill in County Durham so I thought it would be a good idea. I rang a contact who had just installed his own turbines to ask his opinion and he told me to just do it, no debate. So that was it! And sure enough, we have done very well from it.

We use a quite a lot power on site, especially at Greencroft Bottling, so the more we looked into generating our own electricity, the more it made sense. This was the start of our sustainability journey really. We weren’t pioneers with wind, but we were definitely one of the first businesses in the region to combine so many different ways to generate renewable power.

How has the business’ sustainability journey progressed from that point?

We’ve got the three wind turbines at our County Durham site, and another one up in Stamfordham. We were going to erect more, until the Government’s U-turn on turbines. But, views about on-shore wind is changing, so hopefully we’ll be able to restart this project again soon. Our turbines produce anywhere from 4.5m to 5.5m kWh per year.

Obviously it’s more windy some years than others and there’s seasonal fluctuations, so the exact amount varies.

We’ve got a small solar array on Lanchester Wines’ offices which powers our lighting. But the big story is our new home for Greencroft Bottling, Greencroft Two. We’ve built the new 22,000m2 (around 240,000ft2) building on our land at our head offices in Stanley and we’ll start moving in this year. We’re spending more than we might otherwise on a new building (£20 million overall), investing an additional £3 million in sustainable practices. We’re the first building in the UK to install Kingspan’s Quadcore insulation PowerPanels which combine outstanding thermal panels with solar – the PowerPanels in the roof will have 2 Megawatts of solar which will create around 1.7m kilowatt hours of electricity per year. We’re continuing to look at other emerging sustainable technology, aiming to making this the most sustainable bottling plant on the planet.

We’ve also got geothermal heat pump systems in our two warehouses in Gateshead, one of which is the home to Spicers of Hythe. This pumps up warm water from the old mine workings beneath the warehouses which we convert into heat, keeping the two big warehouses at a constantly ambient temperature. It’s one of the biggest heat pump systems in Western Europe that’s pumping mine water, and we don’t know of any other UK business using such a system for warehousing. It’s massively efficient, but it’s a big old piece of kit and it’s taken considerable investment to get going.

Is it that fear of not making a return that’s potentially preventing businesses making bigger steps towards sustainability?

One of the main things I want to clear up is the myth surrounding the cost of sustainability. The key is to invest what you can – yes we’ve done the big ticket installations, but sustainability can be smaller scale too. We’re a business at the end of the day, it’s got to wash its face. We should see a return on investment from our new solar in around five years (weather permitting) and this is because we’re using the energy ourselves, as opposed to selling it on where you don’t see good enough payback.

When it comes to most SMEs, most of these ‘big ticket’ sustainable investments are out of reach, but what else can they do to become more sustainable?

Most businesses can install solar, they can certainly do LED lighting and they can definitely introduce energy saving policies. Most SMEs use a fair bit of power, their costs must have gone up four-fold in the last few years. So, if they can produce, or conserve even half of that electricity through these sustainable routes then they’ll be saving themselves a lot of money. Most businesses can borrow the money through asset finance which is quite easy to get. They could pay the investment back in five years for example, then you’ve essentially got your solar panels for free because you’ve massively cut energy bills. What I really want entrepreneurs to take away from this read, is that the barrier to entry for making those changes towards sustainability is really quite low. Even just a small solar panel makes a difference. You’ll get your money back in a few years if you use the power. We’re massive believers in sharing good practice, we’ve made mistakes throughout our journey but it’s been massively worthwhile in the end.

Have you got any plans for more sustainability technology to be implemented across the Lanchester Group?

Hydrogen is something we’ve looked at. But we still think we’re about five to six years out from that being ready to use. It’s quite difficult to produce, it’s quite expensive, and you’ve got to compress it which requires a lot of energy. My current thinking is that for us, when we’ve got spare energy, it might be a good idea to have a hydrogen plant. The hydrogen plants aren’t that efficient yet, but they’re getting there. Trucks in the future will have to be hydrogen powered,

For more information visit: you can’t have a battery truck. That’s one of the things we’re looking at for the distant future. But we’re also looking at our waste and how we can better use that. At the end of the day, we want to be one of the most sustainable businesses in the world and we’re going to continue to make inroads towards that. lanchesterwines.co.uk

On 27th June, Entrepreneurs' Forum Members will have the opportunity to go behind the scenes at Lanchester Wine’s Greencroft site with Tony. For more details see ‘plan ahead’ on page 4 or check out the events section of our website entrepreneursforum.net or scan the QR code.