A number of developed countries have made great progress in increasing the use of wood as a fuel. In the European Union (EU) in particular, wood fuel now plays a significant role in heat markets. Of all the renewable energy used across the EU, 60 per cent is derived from wood fuel and other forms of biomass.

The untapped potential

Many sawmills and board mills already use wood waste as a source of their process heat. All pulp mills and sugar mills do too, but they have sufficient scale to make it economic to also make electricity from wood or bagasse, and use the steam out of the rear of the turbine for their process heat. This cogeneration is extremely efficient, and is the holy grail of wood energy. Unfortunately, cogeneration from wood fuel is only viable at relatively large scale.

These are the logical uses of wood waste, basically ‘no-brainers’ but the question remains: where is the untapped potential for wood energy? Well, the answer is in commercial and industrial heat users outside the traditional wood-using sectors, such as at abattoirs, swimming pools and hospitals.

The technology

In Europe – and Austria in particular – a carbon charge and research and development tax breaks have been in place since the 1980s to incentivise the use of wood fuel. As a consequence, there are extremely well-developed wood-fired boilers. These can use wood pellets or wood chip. They are fully-automated – with automatic feed, ignition, cleaning and de-ashing.

In Austria, companies have strived to make wood-fired boilers as convenient to use as a diesel boiler. These are unmanned systems where all you do is tip the wood fuel into the fuel store – everything after that is done for you.

Learnings from across the ditch

The New Zealand Government made $NZ9 million available between 2005–10 to encourage the broader use of wood as an energy source. This resulted in over 70 users making the switch including schools, industrial laundries, and mattress manufacturers.

Living Energy installed boilers at swimming pools, hospitals, schools and waste water treatment plants. Users reduced their running costs and reduced their emissions, using locally-sourced wood fuels.

Air quality

Modern wood boilers are much cleaner burning than coal boilers, so many users have made the switch in order to clean-up the local airshed.

Wood chip is typically cheaper than natural gas, and much cheaper than LPG and diesel, so users can see the long-term cost advantage of selecting wood versus other possible fuels.

So what about the wood fuel supply?

Fuel can be sourced in most regions, whether it is old pallets diverted from landfill, sawmill waste, pulp logs or export chip, or log-making residue derived from the forest. It could even be from more obscure but still plentiful regional resources, such as macadamia nuts or apricot stones. Plantation forestry residues seem a particularly obvious choice.

Often thousands of tonnes of wood waste are burnt-off after harvest to reduce the risk of bushfires. It would make much more sense to recover this waste and use it to generate heat – or even electricity – for local use. Obviously the air quality would benefit greatly too, and fossil fuels would be displaced.

Wood chip or wood pellets?

Wood pellets are particularly well-suited to home use, where they are convenient, clean-burning and competitive with diesel or LPG boilers. Pellets have greater energy density than chip, so larger users could also use them where they have space constraints.

In Australia, pellets can be sourced from New Zealand or locally, where production is set to reach up to 400,000 tonnes, mainly destined for export. The opportunity may exist for these pellets to be used by local hospitals instead to help reduce Australia’s carbon footprint.

Generally wood chip (or other woody waste streams such as apricot stones) are lower cost than pellets and make particular sense where it can be sourced locally. This is a win-win for the community as the waste producer finds a beneficial use and the heat user gets lower cost, carbon neutral energy.

Where to from here?

Officials and policy-makers need to recognise that there is a whole energy sector out there made up of large heat users, for whom there is a proven, readily-available, low cost carbon-neutral solution, in the form of locally-sourced wood energy.

Rob Mallinson is the Managing Director of Living Energy and Chairman of the Bioenergy Association of New Zealand.