Bioenergy in Europe vs NZ
Why don't we have bioenergy sector in New Zealand?

The bioenergy sector in Europe, the United Kingdom, Germany, and Denmark differs from the New Zealand market and is, therefore, more mature due to the mechanism employed in each region.

In Denmark, for example, Bioenergy plants qualify for up to 45% of the capital cost of the government subsidy. Thus, for every 100 Euro a developer spends, the government provides a 45% rebate. In addition, the price per kilogram of biogas is exceptionally high; the biogas plants qualify for input credit under the ETS.

Germany, for all municipality waste and on nearly all farm they use biodigestation. The situation exists because the government guarantees a "take or pay" contract, and most of the time that use the biogas in combined heat or power plants. When the grid requirement isn't there, the government backs the production, and government bonds finance the market.

In New Zealand, for many years, climate change advocates have been trying to get it off the ground. We have green investment finance options; the willingness to provide project finance is there. Still, will the government guarantee finance for new projects; that's a whole other story.

In Europe, governments have recognised the value of processing waste more effectively. For example, in Demark, the digestate is given to the farmers free of cost. Because of this, 60-65% of farms utilise organic fertiliser as a substitution for chemical fertiliser. The capital subsidy and supply contract guarantees are over a long term, and emissions credits earned from bioenergy creation that substitutes fossil fuel create tradable certificates. 

It's these mechanisms these foreign governments put in place to create a bioenergy industry none of this exists in NZ at the moment. We invested in hydro energy (and coal plants), and up until now, the cost of landfills has been relatively low, so disposing of waste to land was considered standard.  The problem for councils now is landfill fees are increasing by $10 per tonne per year, emissions liability, currently charged at $39-40 per tonne, is forecast to double. Climate change will influence our policy, and we know NZ NZ Gas is decarbonising.

One of NZ's leading climate scientists, Mike Joy, recognises the value of substituting organic fertiliser for synthetic fertiliser. But there is no recognised policy directive from the government to accelerate renewable bioenergy certificates that are credible. So, for now, the benefit of bioenergy for a council will be based on waste minimisation, emissions reduction and the private market pricing for biogas and fertiliser. In reality, we're leaving it up to consumers to choose emissions friendly products and relying on the self-reported carbon tax.

Frankly, if you didn't see the tractors driving down the main street of town again, then it's time to become aware that organic fertiliser and bioenergy at scale fuelled by the primary sector waste could solve quite a few of our problems. Perhaps we still have some way to go.

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