The Government wants ideas on what to do with millions of used car tyres.
It says four million tyres are taken off vehicles in New Zealand every year, and they present a big ecological problem.
About one million are re-exported for recycling or burnt for energy and the rest go to landfills or end up dumped in piles beside rivers or on the coast, creating a fire risk.
Environment Minister Nick Smith said there was strong interest from the tyre industry for a compulsory collection system and prohibition on waste tyres going to landfills.
"But there problems in finding places to put the tyres, and the markets for recycled rubber products like mats and artificial turf are limited," said Dr Smith.
"We need to find more ways to use waste tyres if we are to find an enduring and sustainable solution to this waste problem.
"Possible alternatives include using the tyres as a source of fuel in cement kilns and power stations."
Dr Smith said New Zealand's current management of waste tyres did not match up with its clean green brand.
"Too many end up in rivers and on the coast, or in unwanted stockpiles posing a fire risk. Our ambition from this initiative is to fund work with entrepreneurs on a solution that can create jobs and improve the environment."
A Ministry for the Environment report released in May this year found there were risks of chemicals leaching from tyres in landfills and air pollution from those that are burnt.
The problems in New Zealand match those in the United States, which generates almost 300 million used tyres a year.
In Florida, an attempt in the 1970s to create an artificial reef with more than one million used tyres ended up causing a bigger problem, when currents and storms dislodged them.
The government is seeking proposals for the use of its Waste Minimisation Fund by 11 November, focused on securing markets for used tyres.