These two articles give us another snapshot of the algae biodiesel industry which has been built out mostly to absorb a lot of cheap capital ahead of any convincing technical success. That really is the problem.
That we have a breakthrough in harvesting and drying is good news and an issue I addressed months back because no one had much to say about this most fundamental issue. That this is recent news is bad news. It takes years to polish technology like this.
I think we will master this technology and that it will become our best source of biodiesel, ethanol and other organic feed stocks. The problem is that we have begun a serious twenty year development cycle that is way more difficult than wind or geothermal which are both thirty years down the same road.
I would like to see work done on integrating algae production with some form of shallow sea system. We certainly get the requisite algae blooms with a minimum of encouragement. Converting that into a form of husbandry should be possible.
I believe algae to be suitable operated in the sea and on non arable lands with excessive sunlight. That prevents competition for valuable agricultural lands.
I would also like to see a productivity comparison between optimal algae production and optimal cattail production. Right now, I think cattails win.
When Will Algal Fuels Be Plentiful and Cheap?
The algae industry is getting there – growing, harvesting, separating and converting to useful oils is nearing completion and the ideas are proving up nicely, which should trigger competition in ideas for the process steps in controlling production costs.
Lots of claims have been made over the years for algae energy efficiency: Some experts say each acre given over to algae cultivation could theoretically produce the equivalent of thousands of gallons of oil per year, compared with an estimated yield of 18 to 335 gallons of ethanol per acre for traditional biofuel crops. Others claim that algae-growing systems could be tweaked to yield as much as 100,000 gallons per acre annually.
There are four important steps in the production of algal biofuels: growing the algae, harvesting the crop, separating the oil, and refining the oil to useful fuels. Each step in the process is the focus of intense study by scientists, engineers, and technologists across the developed world. We have already seen a very significant breakthrough in harvesting and drying of algae.
Technologists tend to overestimate what can be accomplished in two years and underestimate what can be accomplished in ten to twenty years. Algae as biofuel looks more like a ten to twenty year project. DARPA is betting on three to five years, VCs are betting on three to five years, the algae roadmap from DOE takes a decade. _Greentech
A better method of making fuel from algal oil has got a lot of biofuel analysts excited:
"This is the first economical way to produce biodiesel from algae oil," according to lead researcher Ben Wen, Ph.D., vice president of United Environment and Energy LLC, Horseheads, N.Y. "It costs much less than conventional processes because you would need a much smaller factory, there are no water disposal costs, and the process is considerably faster."
A key advantage of this new process, he says, is that it uses a proprietary solid catalyst developed at his company instead of liquid catalysts used by other scientists today. First, the solid catalyst can be used over and over. Second, it allows the continuously flowing production of biodiesel, compared to the method using a liquid catalyst.
A continuous process using solid catalyst is potentially more efficient and productive, compared to batch processing. Also more scalable.
Currently, producing biodiesel from algal oil costs about $20 a gallon. But with all the attention being given each of the multiple steps in the fuel production process, some producers are projecting production costs as low as $1.50 a gallon. If costs drop that low within the next 10 years, algal biodiesel will begin to place an effective ceiling on the costs of petrol diesel. It will take time to scale up production, of course.
Slimed, Pt. 1: Biofuels and the Aquatic Species Program April 3, 2009 at 1:02 AM
Scores of firms, startups and Fortune 500 companies alike, are working on algae-based biofuels. Hundreds of millions of dollars have been invested. And so far, maybe a few thousand gallons of algae oil have been produced.
The question is: Can algae be economically cultivated and commercially scaled to make a material contribution to mankind’s liquid fuel needs? The jury is still out.
Ghosts of NREL Algae Programs Past
The basement of the marine biology department at the University of Hawaii has a hallway lit by a dim incandescent bulb. At the end of the hallway is a cardboard sign with the faded letters “ASP” written on it. A creaky door leads to a dank-smelling room crowded with beakers and algae scientists, milling aimlessly. They share the same slightly green tinge and defeated look.
This is the last remains of the Aquatic Species Program or ASP. These letters are spoken in hushed reverence by today’s crop of phycologists, NRELians and algae-fuel entrepreneurs.
The Program identified hundreds of algae species that could potentially be farmed and cultivated for their lipids — lipids that could be converted to biodiesel and used to wean the U.S. from its dependence on foreign oil.
The Aquatic Species Program was launched in 1978 by president Jimmy Carter to explore the potential of algae as an energy source. About $25 million was put into the program until it was shelved by the Clinton administration in 1996. They never found the “lipid trigger.”
The echoes of that program reverberate in today’s algae fuel renaissance.
On paper, algae is perhaps the perfect feedstock for biofuels. It grows in a wide variety of climates. It can be used to mitigate carbon dioxide. The liquid fuels produced by these single-celled creatures are only one of their byproducts, and potentially not even the most valuable. Cosmetic supplements, nutraceuticals, pet food additives, animal feed, and specialty oils for human consumption may well fetch higher per-gallon prices.
The tantalizing quality of algae is that some algal species contain up to 40 percent lipids by weight. And therefore, according to some sources, an acre of algae could yield 5,000 to 10,000 gallons of oil a year, making algae far more productive than soy (50 gallons per acre), rapeseed (110 to 145 gallons), mustard (140 gallons) jatropha (175 gallons) palm (650 gallons) or cellulosic ethanol from poplars (2,700 gallons).
More optimistic data from less informed people indicate the theoretical biodiesel yield from microalgae is in the range of 11,000 to 20,000 gallons per acre per year.
But according to Dr. John Benemann, a cantankerous algae consultant whose research is widely cited in the field, the realistic potential production level (despite claims to the contrary) is about 2,000 gallons of algal oil per acre per year.
VCs and Algae Farmers
“VCs cannot come in here and just harvest ripened fruit, this is not shovel ready technology,” said Dr. John Benneman.
Considering the immense technical risks and daunting capital costs of building an algae company, it doesn’t seem like a reasonable venture capital play. And most if not all of the VCs I’ve spoken with categorize these investments as the longer-term, long-shot bets in their portfolio. But given the size of the liquid fuels market, measured in trillions of dollars, not the customary billions of dollars, it makes some sense to take the low-percentage shot.
These firms are going to continue to need capital. According to Jennifer Fonstad of VC investor, Draper Fisher Jurvetson: “The current strategy of many of these companies has been to turn to the government stimulus plan – this is the risk capital we can rely on today.”
A Few Conclusions
We need lots more time and more money
Technologists tend to overestimate what can be accomplished in two years and underestimate what can be accomplished in ten to twenty years. Algae as biofuel looks more like a ten to twenty year project. DARPA is betting on three to five years, VCs are betting on three to five years, the algae roadmap from DOE takes a decade.
The scope of the algae to large-scale biodiesel effort is more along the lines of the Manhattan Project or the Apollo moon shot, which cost $24 billion and $360 billion respectively. A $25 million Aquatic Species Program or $300 million in venture capital is not going to get it done. It will take tens of billions of dollars and decades.
All of the process steps need to be addressed
In the words of Courtney McColgan of DFJ, “There are many pieces to the algae puzzle that seem like afterthoughts, but are actually crucial to the economics — co-products, nutrients, harvesting, drying, and conversion technology. System design and algae strain (which seem to be the focus of most discussions) are important, but not the only components.”
Algae producers admit that there’s a massive difference between growing large, consistent quantities of algae versus growing it on a fish tank wall. Standards for growth, strain selection, breeding, genetic modification, water extraction, oil extraction, and oil refining have yet to be established.
Set realistic expectations for the technology
Exploit near term, intermediate technology deployment opportunities such as wastewater treatment. Cost constraints restrict consideration to the simplest possible devices, which are large unlined, open, mixed raceway ponds.
And finally a word from our favorite curmudgeon…
“Engineering studies do not conclude that we can or will actually be able to produce algal oil/biodiesel. They conclude that the R&D to develop such processes can be justified, at least until it can be demonstrated to be impossible,” said Dr. John Benemann.
This is a small excerpt from the April issue of the Greentech Innovations Report which dives deep into the algae pond. You can subscribe to it here.