The past year has seen dramatic changes in the way the Co-operative operates with manufacturing sites moving away from coal and introducing electrode and biomass boiler options to several key sites.
In January 2024, the Co-operative announced it will install a 20-megawatt electrode boiler at its Edendale site in Southland.
This follows the introduction of new wood biomass boilers at Waitoa, Te Awamutu, Stirling, and Brightwater near Nelson. Hautapu is converting its coal boilers to use wood pellets and the Fonterra Brands New Zealand's Palmerston North site has installed a heat pump and solar thermal system.
Waitoa is now using half the amount of coal it did previously. It is the third Co-op manufacturing site to reduce coal in 2023. Fonterra expects to further reduce its emissions through a combination of energy efficiency initiatives and switching fuels at six manufacturing sites using coal that will still be using it in 2024, and will ultimately stop using coal by 2037.
The Co-op is working towards reducing its emissions by 50% by 2030 (from a 2018 baseline). These initiatives are crucial components to achieve these targets.
The new electrode boiler at Edendale will reduce the site's annual emissions by around 47,500 tonnes CO2e which is the equivalent of taking almost 20,000 cars off New Zealand's roads and and will reduce Fonterra's overall carbon emissions from its NZ 2018 baseline by nearly 3% per annum once operational in FY25.
"Being a leader in sustainability is a strategic priority for the Co-operative and we know we have a part to play in helping New Zealand meet its climate targets," says Fonterra Acting Chief Operating Officer Anna Palairet.
"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 with investments in new energy methods a significant investment. The Co-op invested around $90 million in the Waitoa wood biomass boiler while the Edendale electrode boiler is forecast to cost $36 million.
"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," says Anna.
"When you add together the emissions reductions for all projects complete or underway across our manufacturing operations, they reduce our CO2e emissions by a forecast 16% from our 2018 baseline - 279,000 tonnes per annum, which is the equivalent of 116,200 cars off New Zealand roads," says Anna.
The Edendale electrode boiler is being co-funded as part of a partnership with the Energy Efficiency and Conservation Authority. The partnership involves Fonterra undertaking a range of decarbonisation projects at its manufacturing sites to achieve approximately 2.1 million tonnes of CO2e reductions.
Fonterra is partnering with Meridian Energy on the Edendale electrode boiler, with all electricity created from 100% renewable resources: wind, water and sun.
The switch to renewable resources
Waitoa: the biomass boiler will reduce the site's annual emissions by at least 48,000 tonnes of CO2e per annum, the equivalent of taking 20,000 cars off New Zealand's roads.
Hautapu: the conversion of coal boilers to wood pellets will reduce the site's carbon emissions by a forecast 15,785 tonnes CO2e per annum, the equivalent of taking about 6,500 cars off New Zealand's roads.
Stirling: the biomass wood biomass boiler provides fully renewable thermal energy for the site's process heat. This will reduce the annual carbon emissions by 18,500 tonnes of CO2e per annum, the equivalent of taking approximately 7,700 cars off New Zealand's roads.
Te Awamutu: the conversion of coal boilers to wood pellets in 2020 reduced the national coal consumption by 9% (84,000 tonnes of CO2e per annum, the same as taking 32,000 cars off the road).
Brightwater: in 2018, the site switched to co-firing biomass, helping reduce the site's CO2e emissions per annum by 25% (equating to around 530 cars off the road)
Read more about Fonterra’s climate roadmap.