NZ Government to transition schools to use bioenergy
Friday 24 Apr 2026
Brian Cox, Executive Officer of the Bioenergy Association, says
that “The Government’s decision to phase out diesel boilers
in schools is a major step forward for New Zealand’s energy
resilience and regional economies. New Zealanders are being hit
hard by soaring petrol and diesel prices, driven by global instability
and the country’s overwhelming reliance on imported fuels.”
“For the bioenergy sector, it confirms what industry and
communities have known for years: locally sourced wood energy is one of
the most cost-effective, reliable, and future-proof fuel sources
available.”
A Win for Energy Security and Regional Jobs
“The current crisis starkly illustrates that diesel dependence
exposes schools, hospitals and businesses to volatile global fuel prices
and availability. By contrast, wood fuel is produced domestically,
creating stable demand for forestry residues, and supporting jobs in
rural regions. This shift keeps more spending circulating within New
Zealand rather than flowing offshore.”
Lowest Cost, Lowest Volatility
Independent analyses frequently show that wood energy delivers some of
the lowest delivered heat costs in the country, especially for medium-
and large-scale heat users. Several factors contribute to this:
- Lowest cost – wood fuel delivers heat at roughly half the cost
of diesel.
- Stable pricing — wood fuel prices historically have far less
volatility than diesel, electricity, or natural gas, giving heat users
predictable long-term operating costs. Fixed price wood fuel contracts
are available from some wood fuel suppliers today.
- High efficiency modern boilers — today’s wood fuel
boiler systems achieve impressive performance with minimal maintenance
costs, making them competitive even before considering carbon pricing.
- Diesel dependence has left many heat users — from schools and
hospitals to horticultural and industrial heat users — exposed to
volatile global fuel markets. Every price spike in international oil
directly increases operating budgets here at home.
- Wood energy, by contrast, is produced domestically. It utilises
forestry residues, slash and sawmill by-products, along with low-grade
logs. This keeps energy spending circulating within New Zealand’s
regions, supporting local jobs and strengthening rural economies.
Example: A medium secondary school
Using 1,000 GJ of heat per year this school using wood pellets as fuel
would need to spend:
- Diesel cost: $45,000–$55,000 per year
- Wood pellet cost: $20,000–$22,000 per year
The school will save up to $33,000 a year which can be used for
equipment and teacher’s costs. A school pellet boiler system using
off-the-shelf solutions can be implemented within months and will run
automatically, as a direct replacement for a diesel boiler.
“Bioenergy gives New Zealand a real chance to take control
of its fuel future,” Mr Cox notes. “Every
diesel boiler we transition locally is less fuel we need to import
— and one more step toward stabilising energy prices for New
Zealanders.”
A Call to Action
“New Zealand has the feedstocks, the technology, and the industry
capability. This investment in replacing fossil fuel boilers is a
positive step towards future security. The next steps are coordinated
investment decisions and a National Energy Strategy to unlock the full
potential of bioenergy as a strategic national asset for all New
Zealanders.”
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Source: Bioenergy Association
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