Designing homes to conserve energy and use it efficiently, from sources that cause least environmental harm.

Bioenergy and Biofuels

Solid, liquid and gaseous biofuels are becoming more widely used in New Zealand, and have the potential to meet a lot more of our energy demands. In the construction sector they can be used to fuel vehicles and generators and can be used in some domestic space heating and water heating appliances.

On this page:

  • Solid biofuel
  • Liquid biofuels
  • Biogas
  • Environmental benefits


Solid biofuel

Solid biofuel in the form of firewood, wood chips or wood pellets is commonly used in residential and commercial applications for the production of heat.

Pellets are made from wood shavings and sawdust with a standardised density and moisture level, which means that they burn with lower emissions than logs. (Some low emission pellet burners can be used in areas where new wood burners are not permitted, but this depends on the local authority.)

A few models of wood pellet burner can heat water through a wetback.

Liquid biofuels

Liquid biofuels have the potential to replace petroleum-based fuels in many uses, chiefly transport and machinery. But there are other uses too – architects and designers whose client brief includes indoor/outdoor flow and lifestyle might consider outdoor fires that run on bioethanol, for example. The most widely available liquid biofuels in New Zealand are biodiesel (an alternative to diesel) and bioethanol (an alternative to petrol).

In 2015 there were 4.6 million litres of bioethanol produced, making up 89% of the country’s liquid biofuel production. Biodiesel production was 0.6 million litres.

Biofuels are produced from biomass, and this can range from plants grown especially for the purpose, to waste products from industry and commerce, or from forestry and wood processing operations.

In New Zealand biodiesel has been produced from biomass such as used cooking oil, tallow, and canola oil from rapeseed grown as a break-crop (not competing with food production).

Z Energy Ltd built a biodiesel plant at Wiri, Auckland, the first commercial-scale biofuel production facility in New Zealand. The biodiesel was produced from inedible tallow, a meat industry by-product. Unfortunately, changes in global prices for tallow (a price rise) and diesel (a price fall) made production uneconomic and the plant is not currently operating.

Bioethanol is produced from whey.  However, the production of advanced liquid biofuels from the residues of forestry and wood processing has the greatest potential as a source of transport fuel in New Zealand.

In 2013/2014, Norske Skog and Z Energy (with assistance from the Ministry for Primary Industries and Scion) carried out the Stump to Pump feasibility study, looking at the options for converting forest industry residues to liquid fuels. The findings:

  • Enough forest residues exist for domestic biofuel production, and the volume will grow over time.
  • The technology to convert forestry residues to liquid biofuels already exists, but the resulting fuels do not yet meet New Zealand fuel specifications.
  • More research and development is needed, and this will take time. Building a test plant may take longer than expected, especially as the significant fall in the price of oil has added a new challenge to biofuel development.

While a lot of research is going into transport biofuel development both here and around the world, running vehicles and machinery on biofuels is not a new idea – at the Paris Exhibition of 1900 there was a working engine that ran on peanut oil.

Currently available transport biofuels are often used in a blend with petroleum-based petrol or diesel. Bioethanol-blended petrol is available from a few petrol stations in blends of 10% bioethanol (E10). This blend results in 5–6.5% lower greenhouse gas emissions per litre compared with standard petrol. B5 is a biodiesel blend with 5% biodiesel. Blends such as B5 must meet the same requirements as petroleum diesel, such as those relating to performance in cold temperatures. However, the new advanced liquid biofuels will be a 100% replacement for petroleum-based fuel.

All solid and liquid biofuels should be stored in closed containers, in cool and dark spaces, protected from the weather to reduce the moisture they may draw from the air as moisture may degrade the quality of the fuel and thus its efficiency of use.


Biogas from landfills and sewage/wastewater treatment facilities is produced around the country.

For example, since 2008 Nova Energy has generated electricity from gases collected from Wellington’s Southern Landfill, providing enough power today to serve up to 1,000 homes. There is another benefit too: regulations introduced under the Emissions Trading Scheme in 2013 brought in a financial liability around landfill gas emissions. By having the gas captured and converted to electricity, Wellington City Council gets a significant reduction in that liability, saving ratepayers from increased rates or tip fees.

Biogas can also be produced on farms from manure. The gas can be used to run machinery directly to replace mineral diesel or can be used to generate electricity. One biogas system on a Landcorp dairy farm in Canterbury produces enough gas to meet a third of the farm’s energy need.

Environmental benefits

The various biofuels and blends can produce from around 4% to over 80% less greenhouse gas emissions compared to mineral diesel or petrol. The carbon dioxide produced when the biofuel is burnt is effectively balanced by the carbon dioxide the biomass (such as the rapeseed crop) earlier took out of the atmosphere.

(Photograph courtesy Bioenergy Association of NZ)


Updated: 25 May 2020