Pond-generated fuel is many an environmentalist’s favorite. Photo courtesy of San Ramon Tribune

What used to be a nuisance and eyesore for pond owners and lovers of beautiful, clean water is now gaining world acclaim as billionaires like Bill Gates clamor to invest in algae or pond scum and its capacity for producing biodiesel.

Before going to the benefits of algae biofuel, it would be instructive to first discuss what a biodiesel is. A biodiesel or biofuel is an alternative fuel acquired from dead and decomposed plants and animal waste found in all states of matter. Using biodiesel is an act of earth preservation, by respecting the deteriorating earth’s crust which we use up for petroleum oil. Biodiesel use is also a breath of fresh air, literally, since it reduces carbon emission and climate change brought about by petroleum use. Investors are aware of the growing opportunities. Biodiesel has been hailed as the fastest-growing clean technology sector on the market last year when production capacity grew to more than 1,600%. Furthermore, it was also said that biofuel sales could climb to $247 billion by 2020 from just $76 billion in 2010.

Among biodiesel sources, algae are some of the most popular. The sudden popularity of algae is not without explanation. First, algae are cost-efficient and easy to grow. Secondly, algae have the capacity to supply biodiesel, ethanol, and aviation fuels without compromising food supplies, rain forests or arable land. Algae are also the fastest-growing plants in the world and they are said to yield 15 times more oil per acre than other plants used for biofuels.

Other benefits of algae include:
• Reduce carbon emissions by feeding on them.
• Grow practically anywhere.
• Do not require palms for oil production
• Can be used as livestock feed and processed into ethanol
• Algae biofuels are fitting for cold weather climates
• Algae biofuels do not require much space. A twin garage full of algae can generate an amount of energy equal to what a football field of soybeans can produce.
• Algae biofuels can grow on deserts and rocky lands.
• Algae can grow on wastewater
• Algae can double in size within a day or less under the right treatment as compared to the months needed for growing other harvest products like corn and potatoes.

In comparison, biodiesel from crops like corn, soybeans, and potatoes has the following disadvantages:
• Take good arable land away that could have been used for growing food.
• Requires lots of good fresh water.
• Require limited and non-renewable fertilizer to help them grow quickly.

Research and studies have re-affirmed algae’s potential. One of this is a study saying that fuels based on waste greases will reach the market in 2010. Another is a Pike Research prediction of algae-based biodiesel achieving commercial availability in 2012, with larger market impact in 2016.

Will Thurmond, author of the newly-released study called Algae 2020: Biofuels Markets, Business Models, Strategies, Players and Commercialization Outlook, reports that since 2007 more than $1 billion in private and public investment commitments have increased algae-based biofuels technologies, business models, and product strategies. Gas majors Chevron, Shell, and British Petroleum are among those that have committed to algae biofuels. A pattern in the industry by private investors, governments, biofuel leaders, and oil companies, he said, is “to look beyond the research and development phase and to enter the next stage to scale up and build out industrial-scale systems based on several innovative, emerging and disruptive technologies,”

Thurmond’s study published last month by Emerging Markets Online presents the results of a multi-year study featuring 20 site visits and 50 direct interviews with industry leaders Solazyme, Sapphire Energy, Solix, Algenol, Algae 2 Energy, PetroAlgae, Aquatic Energy, OriginOil, SBAE, and other algae innovators.

The study will help algae production companies weigh down each of the possible business models they can employ for the increased productivity and cost-efficiency of their businesses along with insightful corresponding case studies.

Chief findings of the study is algae’s role as a long-term replacement for petroleum crude oil in generating biofuels, biocrude oil, aviation fuel, green chemicals, and biodegradable plastics and polymers. It was also discovered that waste streams like carbon dioxide from power plants, sewage, and run-off from agricultural and livestock farms can be used in generating algae oil and biomass.

Finally, it was found out in the study that co-products from algae like green polymers, chemicals, and animal feed will contribute to the growth of emerging algae production projects. Choosing the right business models and co-product market strategies, according to Thurmond, play a vital role in ensuring the success of a firm.

Some of the algae companies include:
• GreenFuels – a Cambridge, Massachusetts-based company that is developing a technology that utilizes exhaust gas emissions from power plants and industrial facilities to help grow their algae. First, they scrub the emissions to remove some of the Nitrogen and Carbon compounds, then they feed it into their industrial-scale algae farm, which can use untreated water resources. They have raised a large amount of Venture Capital funding, and have installed their technology at various industrial and power plants globally.

• Solazyme – a San Francisco-based company that focuses using either cellulosic biomass or sugar to produce bio-oils for use in the energy, pharmaceutical, industrial, chemical, and nutraceutical markets. Solazyme’s model is to gain licensing agreements for the production of their products. It has also raised significant Venture Capital financing.

• Sapphire Energy – a San Diego-based company that has raised over $100 million dollars from investors such as Bill Gates and was mentioned in Time Magazine’s “Best Inventions of 2008.” Sapphire seeks to produce 91 octane bio-gasoline that can be used directly from the traditional fuel pump.
• Exxon Mobil – a Texas-based company which recently allied with Synthetic Genomics (SGI) and expects to spend more than $600 million on production of alternative fuel from photosynthetic algae.

• Chevron – California-based company which partnered with Solazyme in developing and testing biodiesel feedstock made from algae.

• Shell – a Texas-based company which partnered with HR Biopetroleum to grow an algae plant in Hawaii.

• Solix – a Colorado-based alternative energy technology company for the large-scale commercialization of microalgae-based fuels and co-products.

• Algenol – a California-based algae-to-ethanol company

• Petro Algae – a Florida-based renewable energy company which licensed a commercial micro-crop technology system that enables the production of green diesel and a high-value protein food source in an environmentally-beneficial manner.

• Aquatic Energy – a Louisiana-based company which produces renewable energy biofuels in the Louisiana Gulf area.

• Origin Oil – a Los Angeles-based developer of a breakthrough technology to help transform algae into a true competitor to petroleum.

• SBAE – a Belgian-based company which developed a unique capacity to produce a large range of micro-algae in industrial quantities. Those algae can be used in aquaculture and bio-energy applications.

The global recession has led investors and businesses supporting the algae biofuel sector to grow considerably over the past three years. While state officials and other lawmakers are going the extra mile to tax and restrict carbon emissions and to set up enforced renewable energy goals, the ordinary man-on-the-street, on the other hand, should honor and respect the meticulous processes involved in the generation of the electricity and fuel that people consume—be it renewable or non-renewable energy. Everyone should take part in the regeneration process by conserving energy and being efficient in every way possible.

- Sunshine T. Santiago