A publication of Site Selection

by John W. McCurry
editor bounce@conway.com
Cultures of algae grow in a lab at UC San Diego
Cultures of algae grow in a lab at UC San Diego.
photo by UC San Diego
f the number of companies blooming across the U.S. with ambitious plans to extract oil from algae is any indication, pond scum may indeed be the next big thing in biofuels.
      Dozens of fledgling companies, some backed by high-profile investors, are racing to commercialize algae-based fuels.
      Emerging Markets Online, a Houston-based biofuels consultancy, recently published its Algae 2020 study. Author Will Thurmond reports that algal biofuels have matured significantly in the last few years, moving from small research labs, to pilot projects, to small scale demonstration projects, and now to first-stage pre-commercial trials for CO2 capture in a handful of projects. More than a dozen algae R&D projects, universities, research labs and commercial producers are now completing pilot projects and entering early stage demonstration projects. An emerging trend in algae projects is the production of algae-based drop-in fuels — renewable diesel, gasoline and aviation fuels.
      Thurmond reports that more than US$300 million was invested in algae-to-fuel projects during 2008, and he expects that figure to rise during 2009.
      The San Diego area is emerging as a cluster of algae-related research with the recent establishment of the San Diego Center of Algae Biotechnology, or SD-CAB. Its chief goal is to become a national facility capable of developing and implementing research leading to the commercialization of algae-based fuel. Research on algal biofuels already employs more than 270 scientists and others in San Diego, according to a recent study by the San Diego Association of Governments.
A researcher at a UC San Diego lab examines streaks of algae.
A researcher at a UC San Diego lab examines streaks of algae.
photo by UC San Diego

      "What’s needed to make algae a commercially viable source of biofuel is for scientists to identify and optimize microalgae to enhance their yields and their production of biofuel," said Stephen Mayfield, an expert on the genetics of algae who is a professor at The Scripps Research Institute and associate director of SD-CAB.
      Steve Kay, dean of UC San Diego’s Division of Biological Sciences and director of SD-CAB, said the critical mass of top-notch biologists at UCSD, TSRI and other research institutions that can address these problems and their close working relationships with scientists at local biotechnology companies engaged in biofuels development, make him confident that the San Diego region could become a world leader in the development of biofuels from algae.
      "San Diego could well become the next Green Houston, generating not only high-paying jobs and economic activity for the region, but a new source of renewable transportation fuel for the nation to replace our dwindling supplies of oil," Kay said. "If we can use algae to effectively capture and sequester carbon dioxide, while at the same time producing fuel molecules, we will increase national security and at the same time help minimize the catastrophic consequences of global warming."
      San Diego is also home to Sapphire Energy, one of the more high-profile firms in the burgeoning algae-energy sector. Sapphire, which has financial backing from Bill Gates’ Cascade Investments, has an aggressive and ambitious plan to produce 1 million gallons of diesel and jet fuel per year from algae by 2011. The company further estimates it will be producing more than 100 million gallons annually by 2018 and, by 2025, up to 1 billion gallons of fuel per year.
      "Fuel from algae is not just a laboratory experiment or something to speculate on for years to come. We’ve worked tirelessly, and the technology is ready now," said Brian Goodall, Sapphire’s vice president, downstream technology. "We’ve already successfully tested our fuel with two commercial airlines, and within the next three years we’ll be producing enough to help meet the growing demands of industry and the military. Fuel from algae is an extremely logical approach to meet the needs for a green solution to our dependence on fossil fuels."
      Sapphire’s algae-derived "Green Crude" already has been used successfully in several test flights with the commercial airlines Continental and Japan Airlines.
      Other notable projects include that of Lake Charles, La.-based Aquatic Energy, which plans to develop a 618-acre (250-hectare) commercialized algal farm and facility, modeled after its two-acre pilot plant.
      PetroSun, a Scottsdale, Ariz.-firm, has leased 745 acres (302 hectares) of former catfish ponds in Mississippi for commercial algae-to-biofuels production.

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