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Environmental watchdog attacks lignite plans

Solid Energy and the country’s environmental watchdog are at loggerheads about the viability of proposed lignite developments in Southland.

Dr Jan Wright, the parliamentary commissioner for the environment, released a report today in strong opposition to large-scale lignite developments.

Both state-owned enterprise Solid Energy and the L&M Group are investigating lignite developments over thousands of hectares in Southland and Otago.

Dr Wright said that Solid Energy's lignite-to-diesel plants would produce extra greenhouse gas emissions “likely to cost hundreds of millions of dollars a year”.

She argued that much of that cost would be borne by the taxpayer unless changes are made to the emissions trading scheme (ETS) to ensure that lignite industries are unable to receive free carbon credits.

She also argued that lignite developments would derail future clean-tech industries.

“The sheer scale of investment and production involved in significant use of lignite are likely to lock us into using lignite for decades which would make it harder to move to cleaner technologies.

Solid Energy new energy general manager Brett Gamble denied any suggestion that the company will be looking for free carbon credits.

“Solid Energy is committed to taking full responsibility for the greenhouse gas emissions in all our lignite developments," he said in a release.

"We have factored in the full cost of carbon into the life of each proposed lignite conversion project and we aim to deal with our carbon emissions through a range of approaches and technologies.”

One technology is carbon capture and storage – which Solid Energy chief Dr Don Elder told NBR in October is at a sufficiently advanced stage to develop alongside its lignite projects.

Dr Wright’s report takes a more sceptical view. “CCS technology does have long-term potential to mitigate carbon dioxide emissions in Southland or Otago."

“But it would be irresponsible to make decisions now that rely on CCS becoming both practical and economic.”

Other options to offset emissions include sequestering carbon in forest plantings.

Solid Energy has proposed a pilot lignite briquetting plant, as part of an agreement with US-based GTL Energy, and a lignite-to-transport fuel demonstration plant.

Solid Energy has also agreed to investigate building a coal-to-urea fertiliser plant as a joint venture with agricultural supplier Ravensdown.

Mr Gamble said today that the likely benefit to NZ of the proposed urea plant alone would be an annual increase in GDP of up to $377 million, based on today’s world urea price of $US265 per tonne.

He argued that any discourse around large-scale lignite developments needs to include economic as well as social and environmental considerations.

More by Nina Fowler

Comments and questions
5

Jan Wright is normally reasonably sane in a coven of lunatics. Suggest she gets on a plane and goes to South Africa and visits SASOL, a global chemical giant based on adding value to coal products....something we don't do, normally shipping our raw materials to others for them to make zillions out of them.
Time to join the reality century, where greenies get to love nuclear and SASOL type operations use technology, sequestration and other neutralising innovations to use what's there and available.

This department runs on taxpayer's money, and is unfortunately not on the side of getting anything positive done with the country's resources. They will NEVER issue a report suggesting we do any mining. The country's economy has to operate with RMA and MMP handbrakes pulled up hard.

So it is more carbon efficient to ship diesel and the thousands of tons of urea we use as a farming nation from the far corners of the world than to produce it at home. Has she not heard of carbon miles???? This person is just a ludite!

The loonies are running the asylum.....lets all make our own clothes and live in caves - Jan, you start.

Jan Wright is right. We must leave this dirty coal in the ground. Instead, as the Dunedin City Council report on Peak Oil Vulnerability says - we must look to adaptive methods to counter rising fuel prices and oil shocks.

Solid Energy's spokesperson Gamble has has just said no diesel will be produced from lignite for 8-10 years ( make that 10-15?) and then only at a trickle and making up a minuscule part of our liquid fuel needs. Meanwhile the recent Parliamentary report says an oil supply crunch and petrol price spike may come as soon as 2012. We will not be able to fuel our economy in 2-5 years when shortages and rationing bites. Where is the plan for this looming crisis?

We should be urgently preparing with adaptive measures and conservation for an oil crunch in 1 -5 years but government pretends it's not a threat.

http://oilshockhorrorprobe.blogspot.com/2010/12/dunedin-city-leads-on-peak-oil.html