4 April 2005

Oil price rises, uncertainty over production, the Kyoto Agreement and the increasing demand for oil are just some of the problems driving governments around the world to find alternative fuel sources.

For Kiwis, a key concern is providing a reliable and affordable way to fuel the increasing obsession with cars.  A recent report, by market research firm ACNielsen, worryingly showed that New Zealand has the world’s fourth highest level of car ownership.  89% of New Zealanders, aged 16 or older, own a car.  This staggering figure puts Kiwis only one percent behind Australia and Italy and just three percent behind the ‘king-of-the-road’ Americans.  A positive note from the report was that sedans were the most popular types of car, with 43% owning one while the ‘fuel-guzzling’ four-wheel-drives, where rated fourth with only 10% owning one.

The report also showed that price, design, brand image and prestige are the most important considerations when buying a car, while safety and fuel consumption where rarely thought of, especially by men.  Power was also important.  Of the New Zealanders polled, 56% owned a car with an engine of over two litres.  Interestingly, larger engines appear to become more important the older drivers get.  In the 55-59 age range, 77% of drivers have a car of with an engine over two litres. 

These figures show little signs of decreasing, so, if consumers are not going to change their fuel consumption habits, finding an alternative and renewable fuel source becomes increasingly important.  One solution currently being investigated is biodiesel.  Biodiesel is a carbon-neutral fuel that can be produced from any vegetable oil or animal fat and simply substituted for ordinary diesel.  Depending on the blend, it has lower exhaust emissions than diesel and is therefore less damaging to the environment.

The Energy Efficiency and Conservation Authority (EECA) state that “at a 5% blend, biodiesel in diesel is effectively no different from pure diesel and can be used in any diesel engine without modification.  There is potential for higher blends of biodiesel to be used in specific applications such as bus and truck fleets, and for uses such as in marine and other sensitive environments where diesel spills are a particular hazard.”

Although biodiesel can be produced from crops, or even from waste oil from the fish and chip shop, the main source of biodiesel for New Zealand would be tallow.  This byproduct of the meat processing industry could make approximately 5% of the country’s annual diesel consumption.  Currently, biodiesel is more expensive to produce than ordinary diesel, which is one reason why its use is not widespread.  However, with the support of environmental groups, and the rising prices of crude oil, the economics are shifting in its favour.

Essentially, the main advantages of biodiesel over normal transport fuels include:

  • It is a renewable energy source
  • Reduced overall greenhouse gas emissions
  • Reduced exhaust emissions (which differ depending on the blend)
  • It is more biodegradable than fossil fuels
  • It can cost less if oil prices remain at high levels
  • It can be used on unmodified vehicles (depending on the blend)

In addition to benefiting the environment, there can also be benefits for the ‘health’ of a car engine when a 5% biodiesel blend is used.  EECA offered this explanation, “At this ratio you get reduced emission from your diesel engine, as well as a number of other benefits that include better fuel lubrication and reduced deposits inside your engine.”

No New Zealand specifications currently exist for biodiesel.  This poses a risk that a low quality product could appear on the market which could undermine consumer confidence and potentially put off any companies who may be looking to invest in biodiesel production.  To address these problems, EECA and Standards New Zealand (SNZ) are currently working together to develop New Zealand’s first Standard for biodiesel.

“Many other countries including the USA, Europe and Australia currently have Standards for biodiesel.  However, there is no New Zealand Standard for this environmentally friendly fuel”, explains John Kelly, the SNZ project manager who is overseeing the development of the Standard.  He continues, “It is important that consumers are provided with a product that meets consistent quality and blend specifications so that they can be confident that the fuel they buy at the petrol station will be compatible with their vehicles.  The Standard we are developing will address these issues as well as providing producers, importers and vehicle manufacturers with more confidence that the fuel is of an acceptable quality.”

In Europe, biodiesel is a fast growing market.  Germany is currently leading the way for adoption of the product, using around a million tonnes in 2004.  It has 23 facilities producing biodiesel, with plans for more in the future.  The German experience clearly shows that biodiesel is a viable, consumer-friendly option to ordinary diesel, and with the clock ticking on the world’s oil supplies it could be something which New Zealand needs to start pushing up the agenda.

The Standard, entitled NZS 7500:2005 Biodiesel, will be published in June 2005.