Anthony Doesburg: Green energy in the doldrums

An artist's impression of Neptune Power's tide-driven turbine in Cook Strait. Photo / Supplied

As the UN's Copenhagen climate change conference draws near, New Zealand's efforts at developing green energy alternatives are stuttering along.

Two big projects are held up at the Environment Court and another, which has resource consent so a trial can take place, is stalled for lack of funds.

In all, projects worth about $1 billion, with more than 1GW of electricity-generation capacity - about an eighth of the country's present total - are on ice.

If there's a hopeful glow on the alternative energy front, it comes from pools of poo. In a fortnight a venture that refines algae grown on sewage ponds will be officially launched in Christchurch by Energy Minister Gerry Brownlee.

With the backing of Christchurch City Council, the National Institute of Water and Atmospheric Research (Niwa) and Invercargill-based company Solray Energy, the $5 million operation will produce up to 200,000 litres of oil a year from 5ha of oxidation ponds at Bromley. It's a modest start - that's about enough fuel to keep one big truck on the road.

The Bromley biorefinery is "mark II" technology, says Chris Bathurst, a Solray Energy director, and is a dozen times more efficient than the company's first effort. However, commercial viability won't be achieved until a third-generation refinery is built that will be up to 20 times more efficient again.

What Bathurst and other alternative energy pioneers are up against is shaky economics. At the price at which oil is being pumped from the ground today, the cost of oil production from algae can only be justified if there is a byproduct from the process.

Fortunately there are a couple. After algae is extracted from the sewage muck, reusable water is left behind, and the material that remains after the algae has given up its oil is suitable for use as fertiliser.

Yet getting the technology established remains a challenge, as Nick Gerritsen, a director of another algae-to-oil venture, Aquaflow Bionomic, testifies. Having spent about US$5 million ($7 million) on developing a biorefinery and understanding the chemistry of the refined product, Gerritsen says the Marlborough-based company is yet to start making a return.

Aquaflow has involvement in 20 potential projects on four continents, he says, some of which are more focused on water production than oil. The company finds itself "right on the nexus" of the two big issues of water and energy.

Wind generation has its own set of challenges. Project Hayes, a Meridian Energy plan to dot 176 huge turbines over 92sq m of Central Otago hills, has been stalled since February when an Environment Court appeal against its resource consent ended. A court official says the process of issuing a decision is "getting towards the end".