With ethanol and biodiesel coming under fire for driving up food prices and putting biodiversity at risk, the EU has committed to 'second-generation' biofuels as a cleaner alternative.
Second-generation biofuels are made from ligno-cellulosic biomass - the 'woody' part of plants - which does not compete with food production. Sources include residues from crop and forest harvest such as leaves, tree bark, straw or wood chippings, as well as the non-edible portions of corn or cane.
But there is still a fundamental problem with woody biomass: it often competes with scarce agricultural land and can raise the prices of raw materials like wood.
"One of the current limitations of biofuels is that they need to be produced using land," says Raffaello Garofalo, executive director at the European Algae Biomass Association (EABA). "And this applies to present versions but also to biomass-to-liquids for instance, which are second-generation. Because you still need to have a forest, you still need to harvest biomass somewhere on land."
With algae, however, this problem is virtually solved. "Unlike an agricultural crop, algae does not need at all productive land or good land that is normally used for food," Garofalo says.
Algae grows best in seawater, which comes in virtually unlimited supply, the Italian points out. And the micro-organism seems to be particularly fond of polluted seawater, which helps it grow at exponential rates.
"In all polluted sea places, there is a phenomenon which happens naturally called eutrophication, which means there is an over-growth of algae," says Garofalo. "Precisely because pollution brings excess nutrients to the algae and therefore they grow exponentially."
The idea, he says, is to feed the polluted water to the algae via transparent plastic tubes, using what industry specialists call a bio-reactor. The algae absorb the pollution as a nutrient, and the water can then be returned back to the ocean cleaner than it was when it entered, he explains. In the meantime, the algae grow into biomass, which can be used for biofuels.
"So the immediate impact on the environment is that the water is cleaned up," Garofalo says.
Growing algae can be done in open ponds but the process can be reproduced anywhere on land - including unproductive land such as desert areas - using a bio-reactor.
Big oil investing in research
The technology, which is still at an early stage of development, has attracted the attention of several major oil companies.
US oil major ExxonMobil recently launched a $600 million research programme in cooperation with Synthetic Genomics, Inc. (SGI) to develop, test and produce biofuels from photosynthetic algae. "While significant work and years of research and development still must be completed, if successful, algae-based fuels could help meet the world's growing demand for transportation fuel while reducing greenhouse gas emissions," said Michael Dolan, senior vice-president of ExxonMobil.
Shell launched its own research project in December 2007 to study the commercial viability of selected algae strains at a Hawaii-based facility. "Algae have great potential as a sustainable feedstock for producing diesel-type fuels with a very small CO2 footprint," said Graeme Sweeney, Shell's executive vice-president for future fuels and CO2. "This demonstration will be an important test of the technology and, critically, of commercial viability."
Cost the main challenge
However, a number of challenges remain before algae can be used for mainstream commercial applications, with uncertainties about cost the greatest obstacle to date. "For most algae applications we are still in fundamental research," says Garofalo. "There is still research in order to identify the algae kinds or families which are most appropriate in order to produce biofuels. There is still research on what are the best bio-reactor shape or plastic is best to do this."
Also, it is still an open question whether it is better to grow algae in bio-reactors or in open ponds.
Then comes the question of how to harvest the plants. "Because algae are micro-organisms of a size ten times smaller than hair, you cannot harvest them with a net, for example," Garofalo says.
Options for harvesting include centrifugation or chemical flocculation, which pushes all the microalgae together, but here too, there are high costs associated with such processes.
Capturing carbon dioxide emissions
Microalgae have also been proven to grow more quickly when fed with carbon dioxide. If algae plants are fitted next to factories or power stations, this could even present prospects for reducing emissions from industry.
"You could for example put algae next to a cement plant or a thermo-electric plant and you inject the carbon coming out of the plant into the bio-reactor," Garofalo explains. "This means that the CO2, instead of coming out of the chimney, goes into the bio-reactor to produce algae, which is burnt a second time as a fuel and only then goes into the atmosphere. So the same CO2 can be re-used twice."
In Arizona, GreenFuel, a private company, has developed a large scale algae-to-biofuel plant, which uses CO2 emissions from a nearby power plant, the Arizona Public Service Redhawk power facility. The facility, which opened in 2005, won the 2006 Platts Emissions Energy Project of the Year Award.
Legal and regulatory obstacles
But there are more challenges standing in the way of algae-to-biofuels in Europe. First among those is the lack of a legal framework. "If somebody today was able to make algae biofuels, it would be impossible to market. Because algae biomass is today, legally speaking, an unknown flying object," Garofalo says. "There is no legislation, no definition, no permits, nothing."
The European Algae Biomass Association (EABA) was launched on 5 June partly to address this issue and seek legal clarity under the EU's recently adopted Renewables Directive.
Looking for innovative products beyond biofuels
But the main objective of the association will be to foster dialogue between researchers and industry. "Otherwise, there is a risk of science going in a direction which is completely useless for industry," Garofalo says.
And the key to future commercial profitability, he explains, is to understand that there is more to algae than just biofuel production.
"It will never be economically viable to produce biodiesel or bioethanol from algae biomass if we don't think about the co-products. For instance, when you produce biodiesel, the lipid or the oil part of the algae represents about 25-30% of the product. But what do you do with the remaining 70%? We call it a by-product, but actually it is the same product in terms of weight."
Aside from biofuels and jet fuels, AEBA says other applications include as nutrients, pharmaceuticals, animal feed or bio-based products. In all these sectors, algae and aquatic biomass have outstanding potential to achieve a real revolution towards a fully sustainable economy, the association believes.
However, Garofalo refuses to be drawn into making predictions on when the technology could become commercially viable. "It would not be responsible to give you dates. What we want to avoid is a kind of Internet bubble where people speculate about the quantities and prices of micro-algae in the future."
"There is a lot of investment in research, and this research is driven by the conviction that economies of scale, improvement in yields and output are achievable. It is a matter of time."
"Until research is conclusive, it is impossible to say when things will happen."