Biomass to replace coal in schools and hospitals

Friday 31 Jan 2020

The New Zealand Governments latest move towards getting rid of coal-fired boilers in hospitals and schools shows growing market confidence in the country’s biomass supply, the Bionergy Association says.

A NZ$12 billion infrastructure package which was announced by Prime Minister Jacinda Ardern and finance minister Grant Robertson on Wednesday includes $10 million to replace coal with wood in some schools and hospitals. The Government had already said that publicly owned facilities could not install new coal-powered heat sources. The new money means eight schools and two hospitals will replace their coal-fired boilers ahead of schedule, cutting greenhouse gas emissions by around 3000 tonnes a year.

The decision is welcomed by the Bioenergy Association as a sign the Government now has faith in the supply of biomass. “This decision demonstrates the growing strength of the market to supply fuel,” chief executive Brian Cox said. The association estimates that switching to biomass for processed heat could cut the country’s greenhouse gas emissions by 1.8 million tonnes a year.

Rising carbon prices are also encouraging businesses in the private sector to seriously consider biomass as a fuel-source but are still insufficient to drive change on an economic basis alone, Cox says. Spot NZUs are trading around $29 a tonne. The Government has said it intends lifting the fixed-price option (the amount emitters can pay instead of surrendering a carbon credit) from $25 to $35 this year and that the new cost containment reserve is likely to be set at $50. Cox says carbon needs to be at $80 a tonne make biomass cheaper than coal and gas.

For further details on the announcement and plans, click here

Source: Carbon News, Scoop

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