The Algae Biofuels World Summit is taking place in San Francisco this week. The first day’s pre-conference briefing on Monday provided a thorough and clear-eyed look at the current state of algae for biofuels, and the challenges the infant industry faces to scale operations from the level of an experimental “boutique” fuel to an economically viable component of a national fuel energy strategy.
Of the many reoccurring themes throughout the day, one was of the general misperception of algae biofuel – often that it is cheap and easy, a panacea for all our carbon fuel problems.
We should dispense with that now – economically scalable production of biofuels from algae will not be cheap, easy, or a total solution for anything. And totally worth it, if done right.
The devil is in the details
To illustrate the common misperception that fuel from algae is a simple matter, Mark Hansen, a principal partner with Stoel, Rives LLP, related a phone call he recently received from a landowner at Lake of the Woods in Minnesota. The gentleman asked Hansen how he’d suggest going about setting up an algae harvesting business because the lake “has a lot of algae.”
The process of sourcing, growing, and harvesting algae is, as Hansen told the eager and misguided landowner, a “bit more complicated than that.” There are better-informed evangelists claiming algae as a cure for a host of societies ills, and there is no doubt that algae holds significant promise – not only for biofuel, but for nutritional products, nutraceuticals, animal feedstock, wastewater treatment, CO2 mitigation, job creation and more. Given the enthusiasm from the 200 or so participants in the forum on Monday, algae is indeed wonderful stuff. But the enthusiasm was tempered with a cautious realization of the challenges that lay ahead.
Taking the promise and potential of algae, divorcing it from the hype, and adding a dose of reality is key in the pursuit of finding a way to scale algal oil production to the commercial enterprise level. The devil is in the details.
Frankly, some of the technical talk bandied about at the briefing went straight over my head, as it would for any non-phycologist, but I certainly got the gist of it. So let’s review some key points discussed by the men and women that will actually make the promise of algae a reality.
Not “shovel ready”
With all the money from the Obama administration earmarked for “shovel ready” clean energy projects, it may reasonably be assumed that algal biofuel production should be on the list. The fact is, commercial scale biofuel production from algae simply isn’t shovel ready. Some key reasons why include:
- More R&D is needed, more pilot projects, more data, more real-world experience, more and larger facilities in production.
- More training, more basic science, more young college graduates pursuing research careers to develop the science (college students, are you listening?)
Without the basic R&D, algae biofuel will not get beyond the level of a small-scale, boutique fuel. There is no guarantee that investment in R&D will yield commercial scale algae processes, but the potential warrants that investment nonetheless:
“…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” Dr. John Benemann, Benemann Associates
Before the shovel can be put to the 50-million-gallon commercial plant basic science and R&D, pursued in part with a new, young cadre of scientists and researchers, is essential.
Sufficient sources of CO2 becomes a potentially limiting factor when for enterprise level algal production. Many expressed the feeling that the cost of sourcing CO2 has been significantly under-estimated.
Increasing productivity, efficient harvesting
According to Dr. Benemann, a consultant whose research is widely cited throughout the industry, the current potential production levels (despite wildly optimistic claims to the contrary) is about 2,000 gallons of algal oil per acre per year. Some at the briefing had the figure at around 2,500 gallons per acre/year, but that is certainly the upper limit. A key to scalable algal oil development is increasing that productivity
Benemann feels that through genetically engineered algal strains productivity can be increased 2, 3, even 4 times from the current limits. Having said that, he also stressed, as did others throughout the day, the need for an immediate moratorium on genetic engineering of algae strains.
This apparent contradiction stems from the fear of misguided public perception (sound familiar?) in regard to the impacts of genetic engineering on human health and the environment. Benemenn voiced his absolute belief that no such risks exist with GE algal strains, but that to move forward willy-nilly with such work would be a shot in the foot to the industry. Following the nano-tech model was considered the best approach to adopting genetic engineering for algae.
The costs of harvesting and biomass extraction require development of an economically viable and “robust” process of recovering and converting the biomass. Ben Cloud, president and COO of XL Renewables talked of the advantages and disadvantages of open and closed systems, from circular and raceway ponds for open systems to photo-bioreactors for closed systems.
While closed system provide the most control over growing and harvesting, the more expensive and complex systems are not likely to ever be economically viable in real-world projects at scale. Dr. Benemann said simply that they “do not work.” The consensus looks to mixed raceway ponds, such as the one pictured above, as the only practical means of economically producing algae at any significant scale.
That said, Cloud talked of XL energy’s semi-closed “V” trough system that produces commercially viable algae biomass. In fact, of all the speakers at the briefing on Monday, Cloud was the only one with an ongoing enterprise in the business of producing algae biomass, albeit primarily for the animal feed source market, yielding $1,100/ton, about twice what he could get for conversion to biofuel. Cloud stressed the need for a premium on the oil as an economic incentive for extraction.
The principal point goes back to the need for more R&D to increase biomass productivity while reducing as much as possible the costs of harvesting.
In 1978 president Jimmy Carter launched the Aquatic Species Program to research the potential of using algae as an energy source. That effort wavered throughout the 80’s, and was abandoned by the Clinton administration in 1996. The best projections at the time placed the cost of a barrel of oil produced from algae at between $40-$70 a barrel. With crude oil costing about half that, algae was deemed economically impractical. Fast forward a decade, and we find ourselves in a brave new world.
With passage of the Energy Independence and Security Act of 2007 (EISA) came renewed interest in the potential for energy from algae.
Philip Pienkos, Principal Research Supervisor for the National Renewable Energy Laboratory (NREL), was tasked with heading the team that drafted a Department of Energy “Roadmap” for the algal biofuels industry.
Of the many salient points Pienkos laid out in his discussion, the overriding one is the urgent need for a regulatory framework of policies and standards for the industry.
There is currently no regulatory body or set of policies designed to address and oversee an industry that at scale comprise both agricultural and industrial processes on one site. Pienkos envisions one regulatory body that will combine functions now spread across the EPA and USDA for administering a set framework of policies and standards in which the industry can safely, effectively, and efficiently operate.
“Open source” sharing of information
Ron Pate of Sandia Labs expressed the need for an “open source” approach to information sharing within the industry. Pienkos seconded that idea, stating that innovation tended to be too isolated or “modular.” On the other hand proprietary IP (such as certain components of Ben Cloud’s semi-closed V-trough process), are considered valuable business assets.
One of the more intriguing statements of the day came from Ike Levine, an associate professor of natural and applied sciences at the University of Southern Maine and consultant for several firms pursing algal biofuel: “If all the knowledge was put on the table today, algae biofuel would be economically viable – today”.
As much as Levine would have loved to put some of that knowledge on the table, his obligation to a number of NDA’s prevented him from doing so, or he’d “have to kill all of us,” (needles to say, said in jest).
But that does get a member of the misguided and misperceiving public like yours truly wondering why more information can’t be shared in working toward the common goal of commercial-scale biofuel production.
Not stand alone – think co-op!
Ben Cloud brought the point home, but it was repeated by almost every speaker throughout the day: A stand-alone algae biofuel operation simply may never be economically viable. Co-location, co-products, co-processes are and essential aspect of a commercially sustainable business model, producing a wide variety of energy and non-energy products.
In fact, the pathway to economically producing algal biofuel at scale may mean producing something else entirely in the beginning, as Cloud’s XL renewable has done. But even when producing biofuel, many other products and services can be produced. Among them:
- CO2 mitigation (note that algae acts as any other biofuel does and does not sequester CO2
- wastewater treatment
- medicinal uses
- source of food/protein (food and fuel)
- biomass/process waste heat for generating electricity
The take-away on this point is that co-generation, co-location, and co-products are an critical aspect to an economically scalable business model.
Water, not land, a significant limiting factor
Of all the challenges faced in the industry, water is one of the biggest. Water use, water loss (primarily through evaporation), and plant “de-watering” (drying) where issues brought up repeatedly throughout the day. Unfortunately, most felt these issues have not yet been adequately addressed within the industry. Tony Michaels, managing partner and director for Proteus Environmental Technologies, talked of the “food vs. fuel” controversy being replaced by “water vs. fuel.” While much of process of growing and harvesting algae does not require fresh water, the issue, says Michaels, will always lead to fresh water resources and the price paid by the urban consumer, which could be adversely affected by a nationally scaled algae biofuel industry.
Evaporation is a monumental concern, with millions of gallons of loss daily from a single small operation. When asked about facility siting, the only caveat Michaels gave was “Not in the desert. The evaporative loss is simply too high.” Even with the increased sunlight and longer growing season, the tradeoff to evaporation in the desert is, according to Michaels, too much to sustain a commercial enterprise.
Though a limiting factor is the amount of available land flat enough for siting a project, availability of land, on the other hand, was not seen as any significant problem. The 57 million acres of sufficiently flat land is widely dispersed throughout the country, with some of it in unsuitable climate (Arizona desert due to evaporation, Florida due to high humidity impeding the drying and de-watering process – ironically, drying is maximized in the desert while evaporation is minimized in the humid southeast). Land can be graded, but that adds significant cost to the project.
On the whole, water is the big challenge that needs to be addressed before commercial scale production is possible.
Reducing risk and uncertainty (how robust is the process?)
Tony Michaels spoke of the need to design “robust” systems and processes that are proven sustainable in order to reduce risk and uncertainty for the industry to mature. This again leads back to more R&D, pilot projects, and acres in production to determine what really works and what doesn’t
Watch your language
Going back to the points of public misperceptions, Mark Edwards suggested the industry consider language as a means of helping to maximize the value chain:
“cultivated algae production” good
Words matter and, as we’ve seen, public perception is important. The words, phrases, and terminology adopted by the industry is a key factor in shaping realistic and supportive public perception.
Keeping it simple
Finding the best cost/benefit process for scalable algae production always leads to less capital intensive, lower yield systems and processes (like open raceway ponds). Thus far, no “sweet spot” has been found where more expensive, higher yield systems have proved economically practical.
Keeping it simple might not be the most controlled and highest yielding way to produce algae biofuel, but it works as a business model.
Scratching the surface
These notes from the briefing are, of course, just scratching the surface of the hurdles and challenges the algae biofuel industry faces as it works toward commercialization. It was a sobering day for me, a member of the great unwashed masses allowed to sneak into the industry event (I didn’t really sneak in, I had a badge like everyone else).
The reality is that algae is not a panacea or a complete solution. Dr. Benemann drove the point home: “(We) can’t replace oil with algae – there is too much hype and hope”
The good news is that beyond the hype there is promise, renewed interest, and significant potential for algae to become a significant part of the nation’s, and the world’s, energy portfolio. It isn’t all green sunshine and easy energy; the devil is surely in the details. But those details are starting to be seriously addressed by an industry ready to mature, a government pursuing a renewed interest, and a public, if a little misguided, eager to support a sustainable solution to our currently unsustainable energy economy.
Note: I’ve typed and organized these notes fresh off the briefing. There was a wealth of information that space practicality forced me to leave in my notebook (perhaps another post). I tried to cover the main “take-aways” from the various speakers throughout the day. Feel free to continue the discussion, ask questions, or leave comments.
photo credit: ieagreen.org.uk