New Forests and Australia’s Clean Energy Finance Corporation agree to collaboration on bioenergy and biofuel developments

1 August 2013

Projects to be linked to New Forests' forestry investments in regional Australia

New Forests and the Clean Energy Finance Corporation (CEFC) today announced that they have jointly executed a collaboration agreement to finance new bioenergy and biofuel developments. The new investments could include combined heat and power projects or renewable fuels projects featuring biodiesel or syngas associated with forestry investments in regional Australia. New Forests has invested in extensive forestry plantations in Australia, and the agreement may support establishment of new domestic markets for hardwood and softwood timber as well as traditional forestry and sawmill waste products. Under the collaboration agreement, New Forests will seek to develop commercially-oriented investment opportunities in renewable energy that complement regional forest sectors.

New Forests' Managing Director, David Brand, said, "This is an opportunity to diversify Australian markets for timber, turn waste material into energy, and create new jobs and investment in rural Australia. We see biomass based energy and liquid fuels as an area of substantial potential for growth, and an opportunity that could rival the size of traditional timber markets in the next ten or twenty years."

CEFC CEO, Oliver Yates, said "This is an excellent demonstration of how the CEFC can work with the forestry industry to enable bioenergy projects that will fulfil the potential for the industry to convert its waste products into a valuable renewable energy source. Investment in bioenergy can help reduce carbon emissions, lessen the reliance on traditional electricity and has the potential to boost productivity through reduced energy and operating costs."

Bioenergy presently provides 0.9 per cent of Australia's electricity generation, but the Clean Energy Council estimates that this has the potential to increase six-fold by 2020 with the right support in place.

"Linking Australia's very significant forestry resources and skills, and enhancing these through new clean energy technologies utilising cellulosic biomass, will build a new industry of national value," Mr Yates added.

New Forests' investments already include 375,000 hectares of land and timber plantation assets in Queensland, New South Wales, Victoria, South Australia, Tasmania, and Western Australia and Timberlink Australia, with two softwood sawmills located in Tasmania and South Australia. Many of these plantations were established under managed investment schemes and now need concerted effort to develop markets and infrastructure. "Market development is a key part of the work that needs to be done to reposition Australia's plantation forestry sector for the future," said Brand. "As an Australian business we seek to achieve excellent returns for investors, and innovation is a key part of that work."

The collaboration agreement is open to any projects brought forward by New Forests that meet the CEFC investment criteria. New Forests has identified a bioenergy plant in the Green Triangle alongside the Tarpeena sawmill as an immediate priority, as well as an assessment of the potential to use hardwood plantations for bioenergy and biofuel production at other locations.

About New Forests

New Forests (www.newforests.com.au) manages investments in sustainable forestry and associated environmental markets for institutional and other qualified wholesale investors. New Forests executes three investment strategies that provide clients with diversity and choice around risk-adjusted returns, geography, and market exposure: sustainable timberland investment in Australia and New Zealand; forestry investment in high-growth markets of the Asia Pacific region; and conservation forestry and environmental markets investment in the United States. The company has offices in Sydney, Singapore, and San Francisco and currently manages AU$1.8 billion in funds and assets and over 415,000 hectares of land in Australia, the United States, and Asia.