13 February 2024

3 minute read

By: Melanie Epp

In its next step to get out of coal, Fonterra has announced it will install a 20-megawatt electrode boiler at its Edendale site in Southland.

This is another step for the Co-operative as it works to get out of coal by 2037 and reduce Scope 1 and 2 emissions by 50% by 2030 (from 2018 baseline).

The forecast $36 million investment in the electrode boiler will reduce the Edendale site’s emissions by around 20% or 47,500 tonnes of CO2e per annum – the equivalent of taking almost 20,000 cars off NZ roads - and will reduce Fonterra’s overall carbon emissions from its New Zealand 2018 baseline by nearly 3% per annum once operational in FY25.

Fonterra Chief Operating Officer (acting) Anna Palairet says the team considered a number of energy options before deciding on the electrode boiler.

“Fonterra has a complex manufacturing operation spanning the country. As technologies develop, it’s important we continually assess which energy source and technology is best for each site.

“With up to 15 million litres of milk being processed at our Edendale site each day, we need to ensure we have a secure energy supply that can meet processing demands.

“Cost is also an important consideration. Getting out of coal requires significant investment and we need to choose the best option that reduces emissions and operational complexity while also doing what’s best for our farmer shareholders.”

Fonterra is partnering with Meridian Energy for the electricity supply who generate electricity from 100% renewable resources – wind, water and sun.

"Energy contributes around 40% of Aotearoa's total gross emissions and process heat makes up a third of this country's energy use. So, it makes sense for Meridian to work with big industry to switch energy sources to clean energy alternatives” said Meridian chief executive Neal Barclay.

“We congratulate Fonterra for taking this step given the significance and scale of their operations," Barclay added. "Partnerships like these are critical to helping this country meet the target of net zero carbon emissions by 2050."

Further details on the Co-op’s work to reduce emissions associated with manufacturing:

• The Electric Boiler Project is being co-funded as part of a previously announced EECA (Energy Efficiency and Conservation Authority) partnership. The partnership involves Fonterra achieving approximately 2.1 million tonnes of earlier CO ₂ₑ reductions by undertaking a range of decarbonisation projects at its manufacturing sites.
• Fonterra expects to further reduce its emissions through a combination of energy efficiency initiatives and switching fuels at its six manufacturing sites that will still be using coal in 2024, and ultimately stop using coal by 2037. 
• Fonterra’s Waitoa manufacturing site is now using around 50% less coal as its new wood biomass boiler is operational. This makes it the third Fonterra manufacturing site to reduce coal use in 2023. The biomass boiler will reduce the site’s annual emissions by at least 48,000 tonnes of CO₂ₑ, the equivalent of taking 20,000 cars off New Zealand’s roads.
• Fonterra is in the process of converting the coal boilers at its Hautapu site to wood pellets. Once complete this year, the Hautapu site will reduce its carbon emissions by a forecast 15,785 tonnes per annum - the equivalent of taking about 6,500 cars off New Zealand’s roads.
• The Stirling wood biomass boiler now has fully renewable thermal energy for its process heat. Changing to this boiler will reduce the annual carbon emissions by 18,500 tonnes – the equivalent of taking approximately 7,700 cars off New Zealand’s roads.
• In 2020, the Te Awamutu manufacturing site converted its coal boiler to wood pellets, reducing the Co-op’s national coal consumption by 9%, reducing more than 84,000 tonnes of carbon emissions per year – the same as taking 32,000 cars off the road.
• In 2018, the Brightwater site near Nelson switched to co-firing biomass, helping reduce CO2e emissions by 25%, or the equivalent of taking 530 cars off the road.