Businesses see energy options in bio-materials

While the rest of the world laments rising oil prices, Rotorua business leaders hope to turn the trend to their advantage.

The key to doing this, they say, is turning their area into a hub for the growing global industry of bio-materials - plant-based fuels and plastics that leave "low-energy footprints" because they are made from renewable resources.

The concept was outlined at an economic growth forum organised by Rotorua's BrightEconomy Advisory Board yesterday.

"We've got wood, we've got land, we've got [bio-materials research institute] Scion. Now we just need to bring it all together," board chairman Bryce Heard told the forum.

Mr Heard identified several new "fields of opportunity" to expand development in Rotorua beyond the traditional primary industries of tourism, agriculture and forestry.

He said globally demand for bio-materials was growing as conflict threatened oil supplies, fossil fuels were depleted and the need to protect the environment became paramount.

The Kyoto protocol, which imposed penalties for greenhouse-gas emissions, also made bio-materials attractive.

In the United States, the industry was already worth US$60 billion and was expected to triple to US$180 billion by 2010.

"And they are slow starters compared to Europe," Mr Heard said.

Rotorua had several advantages to allow it to lead the way in bio-materials, including that it was the centre of New Zealand forestry, had plenty of arable land, and was developing a bio-materials strategy through Scion.

Mr Heard, past president of the Forest Research Institute, said the city also had a history of innovations with natural resources, pointing to planting of "forest crops" in the 1960s, 70s and 80s to provide building materials and a solution to diminishing native forests around the world.

"We led a global revolution," he said.

Locally manufactured bio-materials, including bio-degradable plastic pots and hard boards made of harakeke [flax], were on display at the forum.

Mr Heard said that overseas plastics made out of potato peelings and cars powered by bio-fuels were already in use.

He envisaged that in Rotorua traditional agriculture would give way in part to dedicated bio-fuel and bio-material crops.

Generating energy locally was identified as another key "field of opportunity" for Rotorua.

Nationally, Mr Heard said, electricity supply was disadvantaged by a fragile, insufficient distribution network.

Rotorua had the advantage of geothermal fields, hydro-electricity and potential bio-crops to generate its own power and allow it to be self-sufficient.

Water was identified as another area of opportunity.

Auckland University Professor of Strategic Management Wayne Cartright told the forum that a shortage of clean water would become a greater source of conflict than oil in the future.

"It is probably the greatest problem facing the world today," he said.

Professor Cartright identified key drivers of economic change for the BrightEconomy Advisory Board, which was set up by the Rotorua District Council.

He said if Rotorua could guarantee itself as a source of clean water, it would make it a highly attractive place for investment and immigration.

Mr Heard said opportunities for producing bottled water were also boundless.

"We complain about the price of petrol. We don't complain about the cost of bottled water ... We are sitting on a blue goldmine."

"The opportunity for the wood industry is to do the same."