30 August 2011
Media Statement

NZ Energy Strategy - Unleashing the Bioenergy Bonanza offers NZ Inc. Huge Opportunities

The Bioenergy Association of New Zealand has welcomed the release of the New Zealand Energy Strategy by the Acting Minister of Energy and Resources and is pleased to see that the Government wishes to work with the sector to unleash the bioenergy bonanza. Bioenergy is potentially a $6 billion industry which is twice what is currently received from petroleum royalties. The Energy Strategy identifies the range of resources including bioenergy available to grow the New Zealand economy to deliver greater prosperity, security and opportunities for all New Zealanders.

The Chair of the Bioenergy Association of New Zealand, Rob Mallinson said “Supportive government policies such as are outlined in the Energy Strategy can assist New Zealand to achieve greater utilisation of its huge indigenous renewable energy resources. New Zealand is rich in bioenergy sources, and has the skills and technology to convert these abundant resources into heat, biogas, transport biofuels and electricity – and it is available here and now. However we can’t do it alone so it is encouraging that the Government will support business to unleash this immense wealth and build on the advantage that bioenergy offers the NZ economy. We would now like to follow up on previous discussions with officials to develop some concrete programmes to help us deliver on the potential”

At present the New Zealand bioenergy resources are largely untapped and the potential unrealised. A New Zealand Bioenergy Strategy - developed by the Bioenergy Association of New Zealand and the New Zealand Forest Owners Association, puts forward the case for creating 27,000 new jobs, land owners obtaining additional revenue from their land via energy crops, and forest owners getting greater value from use of harvest residues that are currently wasted. Not only could bioenergy lead to economic growth but it could supply more than 25% of the country’s energy needs, including 30% of the country’s transport fuels by around 2040.

Commenting on the release of the Energy Strategy today, Rob Mallinson said, “Over the last year there has been some significant progress in consolidating the bioenergy sector so that it is now able to assist land and forest owners get additional revenue from their existing resources. We have also been able to consolidate bioenergy as part of the NZ energy sector map. In working with the forestry sector we have been able to develop a Strategy that will turn opportunities into economic and business growth. The Energy Strategy will underpin this. However if investments are to come about we need stronger and more stable policy. We also need to ensure that existing initiatives such as the Biodiesel Grants Scheme continue so that the confidence that is growing by biofuel users is consolidated. This Strategy is the basis of that policy and with the right follow on support can deliver the potential.”

“Bioenergy now makes up 8.5% of consumer energy used in New Zealand, but this Strategy identifies that we can do much better. We are failing to realize the potential economic wealth from the production and use of bioenergy in its full range of forms. This Strategy has the potential to turn that situation around.” said Mr Mallinson. “We see a nationally significant bioenergy business sector, built on New Zealand’s capability and expertise in growing and processing wood-crops and converting organic by-products to energy. Having government support and assistance will be crucial to the success in achieving the bioenergy target. set out in the accompanying Energy Efficiency and Conservation Strategy.”

Rob Mallinson said that the experience and strengths of the forestry and wood processing sector and New Zealand’s ability to utilize extensive forests plantations was key to the delivery of the targets proposed in the Strategy. The Association is focussed on maximising the return for forest owners and the Strategy sets out a process to deliver such returns for the benefits of the country as a whole.

He added, “Realising the vision will, of course, need investment in the demand-side and in biomass processing facilities, as well as in forest and fuel-crops, creating an industry with potential annual revenues greater than $6 billion”. “The Bioenergy Strategy is about better utilising a large indigenous resource that is currently being overlooked. In the short term bioenergy can supply cost-effective heat to all users, and can convert industry and council waste streams to valuable fuels – which will create more jobs and help to enhance our clean image. In the medium to long term bioenergy can avoid the need to import a good portion of our transport fuels per year, and can offer large export opportunities through liquid and densified fuels to other countries who aren’t so blessed with bio-feedstock.”

“Extending bioenergy’s contribution to the country’s energy needs from 8% to 25% by 2040 will significantly reduce New Zealand’s dependence on fossil fuels and imported oil , improve national energy security, and – as a side benefit – reduce carbon emissions by around 4.5 million tonnes per year. This would be nearly 40% of the greenhouse gas emissions needed to achieve the Government’s 50:50 CO2e emissions reduction target.”

Rob Mallinson added that there were still challenges ahead. “Getting the direction set by the Energy Strategy out into the public domain is the easy part, but the next steps are where we will face our real challenges. The value proposition for New Zealand is strong and robust, and we need to convey this better to business. While it is pleasing to see that the Government recognises the merits of our vision, we need them to assist us to drive it forward in order to maximise this national-scale economic opportunity”.

There are millions of tonnes of forest harvest residues that are currently lying wasted on the forest floor. This is actually a valuable resource and could be collected and converted into wood fuel for industrial heat. Similarly, various waste streams (slurries etc) from NZ’s extensive primary processing industries can be converted to low cost renewable energy sources. NZ has a huge opportunity to tap into low cost, low carbon energy sources that are currently wasted. Better use of these resources would provide NZ Inc with a more cost effective and sustainable energy infrastructure. This will increase our international competitiveness, reduce our net carbon emissions, and allow NZ exporters to not only counter the perceived issue of food miles, but actually increase market share by differentiation as a low carbon product. Other users can benefit from reducing their costs and environmental footprint.

Rob said that “Oil and Gas supplied 5000 jobs currently and around $2 billion GDP. The Bioenergy sector has the potential to be over 3 times this size – whilst also delivering many other benefits to the nation”

“The Bioenergy Association believes that this potential can best be realised through the association and government departments working closely together to understand the opportunities and formulate constructive policy that encourages this economic transition”

“The Bioenergy Association is keen to work with Government to ensuring a market for wood fuels quickly evolves, and that the market for transport biofuels is equitable for New Zealand based fuel producers.”

Mr Mallinson said “The bottom line is this - biofuels present a ‘win-win’ for New Zealand now and into the future. As over 30 years of evidence from Europe demonstrates, all forms of bioenergy are good for business, security of energy supply, waste utilisation, employment levels, sustainability and economic growth.”

Background
The Bioenergy Association:

• Mission Statement is “to promote the maximum utilisation of all forms of sustainable bioenergy in New Zealand”.
• Vision is that “Bioenergy in all its forms will supply more than 25% of the country’s energy needs, including 30% of the country’s transport fuels by around 2040.”
• Has over 300 hundred members working across the length and breadth of the various supply chains.
• Provides a central focus point for liaison with Government agencies, the dissemination of information amongst the industry and long-term positioning of bioenergy into New Zealand's energy system.
• Works closely with the Energy Efficiency and Conservation Authority (EECA) and New Zealand Trade and Enterprise
• Has four Interest Groups which enables a focus on key areas:
• Liquid Biofuels
• Wood Pellets
• Biogas
• Wood Fuel.

ENDS

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