Forestry industry surprised by changes

Ben Cubby
Sydney Morning Herald, July 12, 2011

BURNING native timber will no longer be counted as a form of renewable energy under the federal government's carbon price plan, leaving sections of the forestry industry in limbo.

The future of a proposed biomass power plant generating renewable energy certificates from burning woodchips at Eden, on the NSW south coast, is now uncertain.

The plant's operator, South-East Forest Exports, said it had received no hint of the decision before the plan was made public on Sunday.

The company had already lodged an environmental impact assessment for building the plant next to its woodchip mill, but now is unsure if it can recoup its costs.

''There's never been any discussion with the government; it came as a surprise to us,'' said a company spokesman, Vince Phillips. ''Mike Kelly is the local member and he has said he is right behind the industry. We believed him.''

The plant, to be built on Jews Head at Twofold Bay near Eden, was to have burned up to 51,000 tonnes of wood per year.

Green groups have long opposed the classification of timber as a source of renewable power, arguing that trees left growing in the ground are more effective carbon sinks than trees cut down and burned to create electricity.

The company was arguing, with the support of the state's forestry industry, that the wood offcuts not suitable for export could be used on the site to generate power, making use of material that would otherwise have decomposed, releasing carbon dioxide emissions for no financial gain.

Renewable energy certificates would be generated in the process, and these could then be sold on to energy suppliers.

But that has now been ruled out by an amendment to the renewable energy target regulations in the government's new carbon legislation.

''In some cases the wood will still get burned for energy, in other cases it will decompose, or we would sell it for landscaping,'' Mr Phillips said. ''We could go ahead with the plant anyway and not generate [renewable energy certificates], we could run it off plantation timber - those are the options.''

The Australian Forest Products Association said many commercial forestry operations were unfairly excluded from the new carbon plan and the government's Carbon Farming Initiative. There should be recognition of the carbon stored in products made from timber, the association said.

The Wilderness Society said the amendment of the renewable energy target was a recognition that logging should not be justified as a source of fuel for power stations.

''For us, this is an anomaly that has been sitting in the system now for about eight years,'' the society's national campaign director, Lyndon Schneiders, said.

''These biomass plants are really a last-ditch attempt by the native forest logging industry to hold themselves up, because their ability to export woodchips is drying up.''

Anti-woodchipping group ChipBusters said it was a setback for the industry, but was dismayed there was not more recognition of the carbon sequestration potential of forests.

"Why tax other big carbon polluters but not the woodchip industry, an industry that is subsidised to destroy our enormous carbon stores, our forests," a spokesman, Noel Plumb, said.

"The Gillard government will not even cut the fuel subsidy for logging trucks that take the old growth forests from distant wilderness areas to the chipmill."