The construction of a major new rail freight terminal in Inverness is moving forward following a funding commitment of up to £3 million from the Scottish Government. The project, with a total value of £11.2 million, is set to transform how goods are transported, dramatically reducing the reliance on heavy goods vehicles (HGVs) for domestic distribution.
The funding, awarded through the Freight Facilities Grant, goes to West Fraser Limited for a facility to be built at the company’s Dalcross site. This terminal is designed to move more goods to the UK market by rail, supporting sustainable economic growth and climate goals.
A Major Contribution to Decarbonisation
The project is expected to deliver substantial environmental benefits. Over a ten-year period, the new rail link is projected to result in the removal of more than 8.5 million lorry miles from Scotland’s roads, and over 17 million from UK roads in total.
The grant programme recently reopened for applications following a commitment made in the 2025-26 Programme for Government.
Cabinet Secretary for Transport, Fiona Hyslop said: “I’m pleased to make this award at the start of Scotland’s Climate Week. We know that shifting freight to rail reduces road congestion, improves air quality, and reduces emissions. Rail freight services are vital to sustainable economic growth across Scotland. This project can make a clear, measurable, and early contribution to the reduction of emissions from HGVs, as well as contributing to our targets to increase the volume of freight being moved by rail.”
The Cabinet Secretary quantified the potential impact, noting: “In fact, this particular project could equate to removing the equivalent of up to 100 HGVs permanently from our roads per week, with the potential for even more should other companies use the facility.”
Industry Collaboration and Environmental Payback
West Fraser Limited, a major player in the timber industry, welcomed the collaboration, detailing the expected environmental payback of the new facility.
George Webb, European Purchasing Director for West Fraser Limited said: “West Fraser is delighted to work collaboratively with the Scottish Government to help facilitate the construction of a rail freight terminal at West Fraser’s state of the art Inverness OSB mill. This facility will help accelerate the switch from road transport to rail, improving efficiency, removing some 20,000 HGV journeys off the A96 and A9 and eliminating approximately 9000 tonnes of CO2 emissions per year, in the first phase.”
Construction has now commenced on the site, and the facility is expected to begin operations in mid-2026.
The Scottish Government sees this investment as part of a wider policy effort: “Scottish Government policy, leadership and partnership working, combined with a growing focus on rail freight’s environmental benefits, have been instrumental in supporting and promoting sustainable rail freight growth in Scotland. I welcome West Fraser’s significant investment in this new terminal and look forward to seeing how this collaborative approach can continue to have a meaningful impact on industry and the environment.”
