Installation of the state of the art system – which will cut carbon emissions at the hotel by 77 tonnes a year and save over £15,000 a year in gas, oil and electricity – is about to commence and will be completed by the autumn. The hotel has received a grant of £33,700 towards the cost from the recently announced Scottish Government Scottish Biomass Heat Scheme.

The hotel has also secured planning consent for 12 new deluxe bedrooms, a luxurious spa and a new bar, coffee shop and bistro which will keep the hotel at the forefront of the tourism and wedding industry.

This project, which will cost £1.6 million, will also incorporate private dining rooms formed from the castle's original cellars and an upmarket shop.

It will start in mid to late 2010 with completion scheduled for spring 2011, creating at least six new full-time jobs.

Colin Thompson, owner and managing director of DCH Ltd, said: "We are delighted to announce these two important redevelopments, the first of which, the installation of the biomass, solar heating and hot water system, will commence immediately.

"There are other hotels in the west and central Highlands which have similar schemes but we believe we are the first in the north Highlands to embrace the concept on this grand scale.

"It is well known that the Scottish Government wants to build a commercially viable and diverse renewable energy industry in Scotland and the Scottish Biomass Heat Scheme is a major part of this.

"As hoteliers it will benefit us enormously to reduce dramatically our heating and hot water bills, both from a cost point of view and in reducing environmental impact.

"Tourism is extremely important to this part of the world and we want to give our guests, who come from all over the world, the very best experience whilst doing our bit for sustainable tourism."

The biomass system works with a German manufactured wood-fired burner which burns solid logs and wood waste. The heat generated is stored in three accumulator storage tanks totalling 8000 litres of stored hot water. These are topped up with additional heat from 20 square metres of solar panels.

"What is so convenient about this system is that it links into existing pipework to provide 100 per cent of our hot water requirements and 80 per cent of our space heating requirements," said Mr Thompson. "It also has the additional capacity to cater for our planned extension and any other future redevelopments."

Coming in 2011 will be 12 new bedrooms, one of which will be converted from existing space in the 15th century tower. With spectacular views over Dornoch, it will be similar in style to the hotel's award-winning "Old Court Room" which many local people remember as the original bar.

The other 11 bedrooms, all built to a four-star standard, will feature in a new building on the left-hand side of the castle garden.

"With contemporary private balconies, lounge areas and luxurious limestone bathrooms, they will feature fully wired entertainment and communication systems.

The new bar, bistro, coffee shop and retail shop will be built in the existing courtyard and finished in local wood and stone. They will be linked to the two private dining rooms formed from the original cellars.

Mr Thompson added: "We are fortunate to have a fantastic old building here, rich in character and history. With any planned extension we wanted to work with the fabric and nature of the building to create a fusion of old and new.

"Our architects, Main McCook of Nairn, have come up with a fabulous design which will really equip the castle for the tourism requirements this century demands, as well as maintaining its atmosphere and heritage."

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