Around £3 million will be spent on building on the site of a defunct distillery in Port Charlotte, using distilling equipment from another closed distillery.
Bruichladdich chief executive Mark Reynier said the new Port Charlotte distillery would be "entirely green", with a "genuinely zero carbon footprint using all the latest environmentally sustainable concepts".
Reynier added: "The environmental movement is strong on the theory, but weak in the practice. It will be quite an engineering challenge to see what really is possible."
Once re-erected within existing distillery buildings, Port Charlotte will have a maximum capacity of 1.2 million litres. Since 2001 Port Charlotte Single Malt has been distilled at Bruichladdich's re-opened distillery on Islay.
The move follows Diageo's announcement of a £100 million whisky investment. The company will build a new malt distillery in northern Scotland and expand its existing grain distillery in Fife to help meet anticipated long-term demand from growing markets.