Two of the boilers at Clandeboye will be running with their new fuel source by September in the dairy giant’s largest decarbonisation investment so far.
The project was a crucial step in a commitment to exiting coal by 2037, the cooperative said.
Overall emissions will be cut by 9% with reductions totalling 155,000 tonnes of carbon dioxide equivalents each year - the same as taking 64,000-plus cars off the road each year.
Clandeboye is one of Fonterra's largest manufacturing sites, processing 40% of its South Island milk into cheddar, mozzarella, whole milk powder and other products for exporting to more than 50 countries.
Chief operating officer Anna Palairet said the project was a milestone in its sustainability journey as it worked towards a 50.4% reduction in absolute Scope 1&2 emissions by 2030, from a 2018 baseline.
The Clandeboye conversion was another demonstration of the co-op’s commitment to sustainability and climate action after successful boiler conversions at its Te Awamutu and Hautapu sites, she said in a statement.
Fonterra’s largest decarbonisation investment would reduce its environmental impact, while securing the resilience of the operation, she said.
‘‘This project represents a significant milestone in our journey towards a coal-free future."
Clandeboye cheese and protein operations manager Conrad Harle said the investment would drive fuel diversity in the South Island by providing businesses demand signals to establish wood pellet supply chains.
“The move to wood pellets for the Clandeboye site is a great thing for the South Island as it will play a role in diversifying the country’s renewable energy options while strengthening fuel optionality at the site.
He said regional supply chains would give further options for future decarbonisation investments at its other sites such as Darfield, Studholme, Tākaka, and Edendale.
The conversion is co-funded as part of an Energy Efficiency and Conservation Authority (EECA) partnership. An agreement between the pair has the co-op achieving about 1.2 million tonnes of CO2 cumulative reductions from coal sites being phased out this decade for it to lift its 2030 target from a 30% to a 50% absolute reduction by 2030.
EECA chief executive Dr Marcos Pelenur said it was encouraging to see Fonterra continuing to progress its emissions reduction programme.
“It is a milestone that once again highlights the central role of biofuel in the clean energy space and the use of clever technology in increasing energy efficiency.”
Plans to transition Clandeboye’s remaining boilers and other South Island sites into renewable energy will continue as part of the co-op's wider decarbonisation programme.
Another decarbonisation project was completed at Clandeboye with the installation of a heat recovery system in its lactose plant last February.
The new system recovers high-grade heat from the lactose plant's equipment, saving the site 2.5t of steam per hour and decreasing annual carbon emissions by about 3000t.
Other Fonterra emission cutting projects:
• The Waitoa site’s last coal boiler was turned off last month, for the co-op to be completely out of coal in the North Island.
• The co-op put in its first electrode boiler which was powered up last October at Edendale to generate steam from electricity. The site’s overall emissions were cut each year by 20% or about 47,500t.
• The Hautapu site’s boiler was converted last August from coal to wood pellets, with an expected annual emissions reduction of about 12,000t.
• A new wood biomass boiler at Waitoa last October halved coal use to cut emissions by about 46,000t a year.
- The nation’s largest heat pumps were put in last year at Whareroa as part of a refrigeration upgrade, decreasing annual carbon emissions by about 9100t.
- A wood biomass boiler at Otago’s Stirling site last year reduced annual carbon emissions by about 18,500t as the co-op's first site running on 100% renewable thermal energy.
- A coal boiler converted to wood pellet use at Te Awamutu in 2020 reduced coal use and emissions by about 84,000t.
