Bio-Fuel Producers Rush To Reassure Govt They Can Meet Sales Obligation
April 9th, 2008
• Company “could supply 1st-year target”
• No need to import bio-fuels
• PCE “out of touch” on bio-fuel industry
Two fledgling bio-diesel producers are urging the Govt not to lose its nerve on introducing mandatory bio-fuel sales targets from July 1, after last week’s call by the Parliamentary Commissioner for the Environment for the Bio-Fuel Bill to be scrapped. Biodiesel Oils NZ, which has been making bio-diesel from tallow since 1999, says it could supply the entire first year’s mandatory sales obligation of 0.53%. Thus there would be no need for NZ to import bio-fuels and there would be no risk of unsustainable fuels being used. And Solid Energy’s subsidiary, Biodiesel NZ, has 6000ha of oilseed rape planted, from which it expects to produce more than 10m litres of bio-diesel after the 2009 harvest. The company intends to increase production to 70m litres a year by 2011 and will open a new production facility in Christchurch next year.
Both companies have invested substantial amounts of money on the assumption the Govt is going to bring in mandatory bio-fuel sales targets, and they say it would be huge blow if the plug is pulled on the legislation now. Biodiesel Oils NZ Managing Director Tom McNicholl says it appears neither the Parliamentary Commissioner for the Environment, Dr Jan Wright, nor members of the Parliamentary Select Committee considering the Bill, have up-to-date information on NZ’s bio-fuel production. This is partly because Biodiesel Oils NZ has been deliberately keeping a low profile until it is confident of its readiness to meet the demands of the market. The company has a plant at East Tamaki making 10m litres of bio-diesel annually from tallow, and is planning to build a new plant at Waharoa, near Matamata, capable of producing 60m litres of bio-diesel a year. The new plant is due to come on stream by the end of December 2008.
McNicholl says his company is already selling bio-diesel to Shell and BP and has been working closely with the two fuel companies to iron out any glitches with the fuel. Trials of the tallow-based bio-diesel have taking place in bus and trucking fleets since 2004. McNicholl says there have been no problems related to the fuel and his company is ready to kick start full production as soon as the legislation is passed.
McNicoll says his company could meet half of the first year’s bio-fuel obligation from its existing East Tamaki plant, and 100% of the obligation once its Waharoa plant comes into production. Biodiesel NZ General Manager Paul Quinn says a just-completed study shows bio-diesel produced from South Island-grown oilseed rape emits about 50% less CO2 during its life cycle than mineral diesel. Thus the Parliamentary Commissioner’s concerns about unsustainable bio-fuel are unfounded.
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