'Without income from wood chipping, the native forest timber industry is not viable.'

'Without income from wood chipping, the native forest timber industry is not viable.' Photo: Virginia Star

Despite a setback for logging interests, we are not out of the woods yet.

Australia's ancient native forests were saved the ignominy of being incinerated for government-subsidised electricity by the unlikeliest of candidates this week.

Liberal defector and House of Representatives Speaker Peter Slipper used his first deciding vote to defeat independent MP Rob Oakeshott's motion for native forest biomass to be classed as renewable energy.

It was the latest in a series of bids by the financially unviable native forest logging industry to stay alive despite massively changed community expectations. But the closeness of the vote suggests native forests won't be out of the woods until the industry embraces a sustainable future.

In 200 years Australia has cleared and logged much of its old growth and wild forests so it can only be misguided to burn the rest.

The embrace of the seemingly innocuous-sounding biomass energy is a ''scorched earth'' policy of an industry in hasty retreat.

Late last year the Australian government announced its intention to remove renewable energy subsidies from projects that sought to use native forest ''waste'', including 400-year-old trees, in so-called renewable energy furnaces to generate electricity.

This proposal would have been hilarious if not so serious, but there is a precedent for this desperate play. In the 1960s and '70s, export wood chipping of native forests became entrenched.

Export wood chipping was portrayed to sceptical Australians as a sensible way of finding a market for those parts of a logged tree that could not be processed by a sawmill. But within a few years wood chipping became the only economic reason for logging native forests.

By the 1990s, millions of tonnes per year of native forest woodchips were exported as sawmills quietly closed across the country. Now, with changing market expectations, the world has lost its taste for woodchips from Australia's ancient forests.

For evidence of the collapsing wood chip market, one needs to look no further than the mound of chips that piled up at the Artec mill at Bell Bay in Tasmania, a pile so large that the mill suspended operations last month because it had run out of storage space until it found a buyer this week.

Developments over the past few years have demonstrated clearly that without income from export wood chipping, the native forest timber industry is not financially viable.

Even with wood chipping, the industry has relied on government subsidies for more than a decade.

Last year, the state's auditor-general warned that Forestry Tasmania needed a cash injection of $250 million to remain solvent.

The industry is in crisis. It desperately needs a new income stream to survive. Enter Rob Oakeshott and his friends from the timber industry who claim energy generated from burning native forests is renewable.

Clearly, properly managed timber plantations are a renewable resource, but wood sourced from native forest logging is something else. It can take hundreds of years for these trees to grow to the size of 30-storey buildings, and a matter of minutes for them to burn.

In the meantime, it will take decades for the resulting carbon dioxide to be sucked out of the atmosphere.

A recent North American study found that producing power from burning native forests was more carbon intensive than using fossil fuel in 80 per cent of the regions studied.

The situation would be worse in Australia, which has the most carbon-dense forests in the world.

The native forest industry has been on life support for long enough, yet governments and their rogue forestry agencies continue to draw out its death, subsidising the industry and leaving the taxpayer open to pay out contracts that can't be met.

Forests NSW had to pay Boral half a million dollars in 2006 because it couldn't supply contracts from 2002. Bizarrely, it signed new wood supply agreements in 2004, and last year Boral took Forests NSW to court again seeking a further $1 million.

Forests NSW lost $14 million in 2008-09, $16 million in 2009-10 and $232 million in 2010-11.

The Western Australian government is setting up taxpayers for huge compensation payments in its pursuit to lock in 10-year contracts of 800,000 cubic metres of wood.

Similarly, the Victorian government is trying to lock in 20-year supply contracts for native forest ''waste''.

To aid this it is planning to exempt logging from the Flora and Fauna Guarantee Act so the habitat of the remaining 1000 or so Leadbeater's possums in the Central Highlands can be logged.

The government will risk the extinction of threatened species and what little is left of its old-growth forest to keep the industry going.

The Oakeshott plan aimed to throw another desperate low-value, high-volume lifeline to this dying industry. Burning native forests is not renewable and the reasons for its promotion have nothing to do with climate change.

Lyndon Schneiders is national director of The Wilderness Society.

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