New Zealand is in the en­vi­able po­si­tion of po­ten­tially be­com­ing the Saudi Ara­bia of bio­fu­els in the South Pa­cific, with­out the food Vs en­ergy de­bate over bio­fu­els that has plagued other na­tions.

Element - - Planet - By Brian Cox BRIAN COX

New Zealand has the ca­pac­ity to pro­duce all its trans­port fu­els from in­dige­nous nat­u­ral re­sources. As pe­tro­leum be­comes more ex­pen­sive over the next decade we can tran­si­tion to trans­port fu­els from biomass (or­ganic mat­ter) and waste. Tech­ni­cally th­ese are achiev­able now, but the economics are not quite there.

In­ter­na­tion­ally there are a num­ber of tech­nolo­gies avail­able to con­vert biomass and or­ganic mat­ter into liq­uid bio­fu­els. Some of th­ese have been around for decades while oth­ers are emerg­ing (in­clud­ing from pi­o­neer­ing New Zealand com­pa­nies).

Un­like many coun­tries where the fo­cus has been on the pro­duc­tion of ethanol from sugar crops and biodiesel from veg­etable oil, we can use our crop­ping land for more valu­able prod­ucts, such as food. The New Zealand fo­cus for bio­fuel pro­duc­tion is on us­ing our biomass from wood and or­ganic mat­ter from mu­nic­i­pal waste. As a re­sult we will not have the food Vs en­ergy prob­lems. In­stead, in New Zealand, it’s food plus en­ergy. Trans­port fuel pro­duc­tion from re­new­able sources is not new to us. An­chor Ethanol has been pro­duc­ing ethanol from whey for a num­ber of years. The ethanol can be blended with petrol as Gull cur­rently does.

The pro­duc­tion of biodiesel ini­tially fo­cused on us­ing the feed­stocks tal­low, used cook­ing oil or canola oil, with con­ven­tional con­ver­sion tech­nolo­gies. For a short pe­riod biodiesel pro­duc­tion was sup­ported by fi­nan­cial as­sis­tance from Govern­ment which stim­u­lated fleet own­ers to suc­cess­fully trial biodiesel. De­mand for biodiesel out­stripped sup­ply. How­ever, be­cause of the short term of the as­sis­tance, in­vestors stayed clear of build­ing new pro­duc­tion ca­pac­ity. Now only Green Fu­els NZ, who pur­chased the biodiesel pro­duc­tion busi­ness from Solid En­ergy, pro­duce biodiesel com­mer­cially.

The ex­pe­ri­ence of biodiesel showed the sig­nif­i­cant in­ter­na­tional mar­ket­ing ben­e­fits that are achiev­able for NZ Inc when we se­ri­ously use bio­fu­els in ve­hi­cles. Many tourist busi­nesses, such as in Queen­stown where all tourist op­er­a­tors used biodiesel, gained sig­nif­i­cant mar­ket ad­van­tage from be­ing able to pro­mote them­selves as ‘clean and green’. This car­ries over into our ex­port busi­nesses where sus­tain­able pro­duc­tion is be­com­ing more im­por­tant to cus­tomers.

This ini­tial biodiesel and ethanol pro­duc­tion was al­ways go­ing to be limited, but its im­por­tance with re­gard to tran­si­tion­ing to greater vol­umes of pro­duc­tion was in the ex­pe­ri­ence ve­hi­cle own­ers gained in the use of bio­fu­els. How­ever, there would have been enough feed­stock for con­ven­tional tech­nolo­gies to have pro­vided ad­e­quate quan­ti­ties of bio­fuel un­til the economics of ad­vanced bio­fu­els oc­curred. The emerg­ing bio­fuel pro­duc­tion of great­est rel­e­vance to New Zealand uses ad­vanced tech­nolo­gies and feed­stocks of biomass or waste or­ganic mat­ter. Th­ese are not the most at­trac­tive feed­stocks as they are low in sug­ars and starches. How­ever we have a lot of biomass and we are good at grow­ing it, and we have an end­less sup­ply of or­ganic mat­ter in mu­nic­i­pal waste. In fact, mu­nic­i­pal waste costs us money to dis­pose of.

Com­mer­cial fa­cil­i­ties pro­duc­ing th­ese bio­fu­els are cur­rently start­ing in many coun­tries. How­ever they gen­er­ally re­quire govern­ment sub­si­dies – the level of which gives an in­di­ca­tion of just how close the tech­nolo­gies are from op­er­at­ing in an un­sub­sidised mar­ket such as ours. Tak­ing into ac­count pe­tro­leum price pro­jec­tions I es­ti­mate we are only 5-10 years off be­ing fully com­mer­cial.

We cur­rently waste 10-15% of our for­est pro­duc­tion through har­vest­ing and pro­cess­ing. This quan­tity of wood residue would be enough to get bio­fuel pro­duc­tion started us­ing ad­vanced tech­nolo­gies. This would pro­mote larger quan­ti­ties of biomass from ex­tended for­est plant­ing.

The Bioen­ergy Strat­egy pre­pared by the Bioen­ergy As­so­ci­a­tion in­di­cated that 30% of our trans­port fu­els could come from biomass by 2040. Scion re­search has shown that, long-term, we could the­o­ret­i­cally do 100%.

The economics of this sort of pro­duc­tion is likely to be car­ried through by the value of the co-prod­ucts that are also ex­tracted dur­ing the process. Wood and other or­ganic mat­ter is rich in chem­i­cals, only some of which can be used to make bio­fu­els, and th­ese chem­i­cals will be­come more valu­able as pe­tro­leum prices soar. The chem­i­cals from wood can also be used to make bio-plas­tics which can sub­sti­tute pe­tro­leum-based plas­tics.

Con­sol­i­da­tion of the cur­rent sec­tor, based around the pro­duc­tion of trans­port bio­fu­els and their co-prod­ucts, along with our abil­ity to ef­fi­ciently grow wood, could lead to our work­ing with Asian coun­tries such as Sin­ga­pore, which does not have enough land to grow wood for pro­duc­tion of liq­uid fu­els and bio-based ma­te­ri­als. The de­mand for liq­uid fu­els for trans­port and other uses is un­likely to dis­ap­pear, but the price will es­ca­late, so now is the time to start part­ner­ing with Asian coun­tries so that we use their money, and our abil­ity to ef­fi­ciently grow wood, to pro­duce their liq­uid bio­fu­els. New Zealand could be­come the Saudi Ara­bia of the re­gion in the pro­duc­tion of bio­fu­els.

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