The NSW Department of Primary Industries has distanced itself from a push to convert Redbank Power Station into a biomass generator.
Independent MP Justin Field recently questioned the involvement of DPI staff in site visits and meetings with the project's proponent Verdant Earth Technologies Limited.
A key issue is the source of the biomass, which the project's opponents fear could result in the intensification of native forest logging.
Sweetman is also investigating the possibility of exporting wood chips from the Port of Newcastle for use in a Japanese biomass power station.
A DPI spokeswoman said there were "no agreements of any nature" between the department and Verdant or Sweetman Renewables.
"DPI is not involved in the Redbank project and is not actively working to support it," she said.
"DPI's visit to the Redbank Power Station was purely out of interest. We are interested in all innovative concepts for the use of biomass and waste materials from primary industries in alternative product markets, of which renewable energy is one.
"From DPI's perspective, the Redbank project is simply one of many trials by private sector companies of the use of timber biomass in bioenergy generation that we are monitoring."
Verdant's website previously listed the DPI as a project partner, however, the department's logo was removed on Friday following a request from the department.
The company's website continues to list the University of Newcastle, the Australian Hydrogen Council and Bioenergy Australia as partners.
A spokeswoman for Verdant told the Herald that the company had no agreements to secure future wood supply contracts from the Forestry Corporation of NSW or the NSW government.
"As part of the ordinary process of considering a project of this type, Verdant has referred to the DPI to understand the potential availability of forestry residues for bioenergy generation," she said.
Mr Field said he would pursue the relationship between Verdant and the department at the upcoming NSW Budget Estimates hearings.
"Both Verdant and the DPI still have some explaining to do," he said.
"Why is the DPI sending multiple staff on multiple occasions to site visits and briefings for a project that is strongly opposed by the local council and hugely contentious within the community?
"Burning a million tonnes a year of native forests for electricity is not sustainable or renewable and is hugely emissions intensive. It is entirely inconsistent with the NSW Government's stated aim to reduce emissions by 50 per cent by 2030 and get to net zero by 2050?
"I'll be asking questions of the relevant Ministers when Parliament returns about why this project seems to be getting special treatment."
