A contract awarded by the Department of Finance to supply wood pellets for heating Northern Ireland government buildings has seen its value increase more than three-fold, new details reveal, reported The Irish News,
Fermanagh-based timber company Balcas secured the £7.25 million deal in August, marking a significant rise from the £2 million contract it replaced. The six-year agreement, which began in October, will see the company provide wood pellets for biomass boilers in government buildings—including hospitals, colleges, police stations, and other public facilities—until 2030.
This new contract follows a similar one issued to Clearpower Limited five years ago. The Department of Finance explained that the significant increase in the contract’s value was due to higher-than-expected demand from government users.
“This contract is demand-driven, and the increased value reflects additional users while allowing flexibility to accommodate unforeseen demand for wood pellets over the duration of the contract,” a department spokesperson said. “There is no guaranteed level of expenditure.”
The expanded list of users now covered by the agreement includes St. Mary’s University College Belfast, the Northern Ireland Fire and Rescue Service, the Ambulance Service, as well as health trusts in Belfast, Western, and Southern regions.
Additional entities set to benefit from the contract, as revealed in a tender notice last year, include regional colleges, the Northern Ireland Prison Service, and the Driver and Vehicle Agency (DVA). Other public organizations named include CAFRE (College of Agriculture, Food and Rural Enterprise), Public Records Office NI, Arts Council NI, National Museums NI, Waterways Ireland, and various offices of the Northern Ireland Civil Service.
Reports suggest that just two bidders competed for the tender.
Balcas was initially awarded a Stormont contract to supply wood pellets for a limited number of government sites in 2010. However, the firm lost out to Clearpower when the contract came up for renewal in 2014. Balcas regained prominence as the primary supplier following the launch of the Renewable Heat Incentive (RHI) scheme by former Enterprise Minister Arlene Foster in 2012. The scheme’s subsequent abuse led to the 2016 “cash for ash” scandal, which contributed to the collapse of Stormont institutions in early 2017.
Balcas, which has been in operation since 1962, was acquired by Glennon Brothers in 2021. The company, a third-generation timber processor with plants in Longford, Cork, and Troon, reported a pre-tax profit of £21.85 million in 2023, with a turnover of £137.2 million.
