One of New Zealand's priorities is to address climate change by reducing its greenhouse gas emissions.

Now, scientists at Scion Laboratories have found a way to significantly reduce these emissions, using wood for transportation fuels.

Science Leader for Green Technologies at Scion Dr Paul Bennett says there is potential for wood to be used as an alternative to fossil fuels in the transport sector.

"The biggest sector by far in terms of total energy used is the transport sector. And there's very little renewable energy going into that at the moment. And that's what we're trying to do in this lab," Mr Bennett said.

According to Mr Bennett, wood from forests is one of our biggest untapped renewable energy resources, much of which is left from the harvesting trees in plantations and excess from sawmills.

The scientists have developed a way to extract oil from sawdust to produce fuel.

"We can take this pyrolysis oil and process it further into useful liquid fuels such as marine oils, diesel fuels, or even in the longer-term aviation fuels," Mr Bennett said.

Dr Bennett says if we doubled our current forest stocks we could produce up to sixty percent of our transportation fuel using woods.

"To make a significant impact into that sector we need to grow more forests, we need to have the right policy landscape in place, with a clear future vision that this is what we need to do for New-Zealand. To address our climate change and to address our energy security position," Mr Bennett said.

One of the current major obstacles is the low price in oil which can affect the viability of bio energy.

"I see the price of carbon starting to escalate. It's now over eighteen dollars a tonne at the moment. That will have a major impact on the use of bio energy across New Zealand," Mr Bennett said.

Mr Bennett says New Zealand's aviation industry has already expressed interest in the use of bio-fuel under its carbon management programme.

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