The Government's desire to introduce biofuels has been dealt a blow by a top independent official, who says the move threatens New Zealand's reputation as a clean, green country.
Jan Wright, who as Parliamentary Commissioner for the Environment is effectively a watchdog for green issues, yesterday told a select committee the proposed biofuel legislation should not be passed.
Caution was needed over biofuels particularly because it was likely that some would have to be imported to meet the mandatory sales levels the Government was proposing.
International debate about the merits of biofuels is heating up, and concerns about the destruction of rainforests and rising food prices are making headlines around the globe.
"Importing biofuel, while avoiding contributing to the hugely damaging environmental and social impacts occurring in countries like Indonesia and Malaysia, would generate high compliance costs," Dr Wright said.
"Importing biofuels also seems inconsistent with our clean, green image."
Concern about the sustainability of biofuels centres on particular fuels, but not all of them.
Some biofuels made overseas are sustainably produced, but it is not yet known if oil companies will stick only to those ones when they have to start selling a small but progressively higher amount of biofuels under the new Government legislation tagged to take effect from July 1.
Climate Change Minister David Parker has said New Zealanders may have to accept initial volumes of biofuels from unsustainable sources for the sake of the long-term fight against climate change.
But Dr Wright warned that damage could be done to the green reputation on which New Zealand traded overseas if unsustainable fuels were imported.
"We trade on this image, it is core to our national identity, it's the brand of many of our companies, it is who we are and how we see ourselves.
"I suggest to you that maybe importing biofuels risks damaging our clean, green image."
Dr Wright's warning will be hard for the Government to ignore.
She is a trained scientist with a masters degree in energy and resources from the University of California at Berkeley and a doctorate in public policy from Harvard.
Since returning to New Zealand, she has worked as an independent policy and economic consultant as well as chairing Land Transport NZ and Transfund NZ.
Political support for the biofuel move is also looking shaky as the debate rages.
Yesterday, Government support partner United Future urged all parties to "slow down" on biofuels.
Leader Peter Dunne said that until enough biofuel was made in New Zealand in an economically and environmentally sustainable way, it was disingenuous for the Government to commit to using it.
To satisfy concerns about the sustainability of imported biofuels, officials are working on a standard that can be used to judge them.
It is not yet known how long that is going to take, but it appears the proposed July 1 start date for biofuel sales will have to be put back.
The Greens and Mr Parker are confident a standard can be settled on, but Dr Wright said it would be costly to verify whether imported fuels met it.
Labour MP Marian Hobbs, a former environment minister, asked Dr Wright yesterday how a local biofuel production industry could be started without an incentive of the type the Government was proposing.
"With no green light, there is no investment," she said.
But Dr Wright said there would be incentives for biofuels through the emissions trading system and by there being no excise tax on ethanol. New Zealand should wait until second-generation biofuels became available.
The Government wants to fight global warming by introducing more biofuels as a substitute for petrol and diesel.
Biofuels are made from plant and animal products such as beef tallow (in NZ) or corn (in countries such as the US).
A law change will force oil companies to sell biofuels from July. They predict a rise in fuel prices by 7c to 15c a litre.
Biofuel production overseas has caused rainforests to be cleared and crops diverted from food supplies.
National, New Zealand First and United Future look unlikely to support the legislation.
Now Parliamentary Environment Commissioner Jan Wright says: "Importing biofuels risks damaging our clean, green image."