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Breaking the Cost Barrier on Algae-based Biofuels

Jeff Siegel | Thursday June 17th, 2010 | 4 Comments

Algae-based biofuel.

It’s been a hot topic for a few years now. And certainly the potential for incorporating algae as a key feedstock for future biofuel production is massive.

But the sobering fact is that we’re at least a good eight to ten years from seeing any kind of real, commercially-ready product… At least at the volumes that could allow for meaningful market penetration.

So where does that leave us in the meantime?

Fortune favors the daring

Algae-based biofuels are often the target of naysayers who prefer to criticize early industry obstacles instead of looking for a way to profit from the developments and technologies that allow us to overcome those obstacles.

Fortunes are not made by launching criticisms without solutions.

Fortunes are made by those who seek innovation while others hide behind the safety of mediocrity.

Yes, it’ll be years before algae-based biofuels are ready for prime time. But that doesn’t mean we’re going to wait around and ignore all the developments that are happening in the world of algae today.

Because one thing’s for certain: When that first big opportunity does present itself, we want to be ready to pounce.

So here are some of the latest developments in algae — developments that will help us hone in on which areas are likely to gain the most momentum in this early stage of the game.

Game-changing propositions

Last week, European aerospace behemoth EADS unveiled a new aircraft that runs on biofuel made from algae.

Early tests have shown that the algae-based biofuel has resulted in a 5 to 10 percent fuel savings with no loss of performance. The company is now looking to expand the algae fuel tests with Airbus, Boeing, and other manufacturers.

Also last week, Siemens AG  announced that it successfully burned algae-based biomass fuel at a utility-scale power plant.

Combining fuel made by PetroAlgae, Inc. with pulverized coal, the fuel resulted in emissions that were 20 percent lower than coal alone.

While we’re definitely not fans of coal-fired power, we know that it’s going to be around for some time. And if we can reduce emissions by 20 percent as we transition to a cleaner energy economy— and do it economically with algae — certainly there could be a real opportunity here.  Although this should not be seen as anything but a transitional process.  With or without minor emissions reductions, the phasing out of all coal-fired power plants is paramount to the success of an environmentally and economically sustainable energy economy.

Breaking the cost barrier

While new developments in algae-based biofuel have been consistent over the past couple years, so have the high costs of production.

So needless to say, we are particularly bullish on any company that can reduce those costs.

One company that’s definitely making some progress on this end is BioEcoTek. It’s been able to reduce costs by placing algae production with existing processes in wastewater treatment.

Essentially, the company’s technology combines anaerobic digestion and algae cultivation that results in a net-positive energy gain in wastewater treatment.

Here’s how it works:

  1. A primary clarifier delivers effluent to anaerobic digesters;
  2. The digesters then reduce the organic load of the effluent and produce biogas.
  3. The reduced effluent — which is rich in phosphates and nitrates — is pumped from the digesters to algae bioreactors.
  4. The biogas is used to generate power while providing CO2 for the algae bioreactors.

And in an effort to close the entire loop, the company is looking into the feasibility of “flash” carbonization of the remaining sludge. This could provide for the production of a charcoal product.

I realize that, for most people, this may not sound like the most exciting thing in the world… But for those who operate water treatment plants, this is extremely exciting.

Because the process I just described can reduce the operating costs of a water treatment plant by as much as 70 percent!

This is huge!

And I have no doubt that this is why American Water, the largest investor-owned U.S. water and wastewater utility company, has agreed to the deployment of the company’s first pilot system at their Hawaii Kai facility. Commercial-scale systems are expected to follow after test results.

This is innovation, my friends. Cultivating algae for future biofuel demand while simultaneously creating a game-changing process for the wastewater treatment industry.

And the potential revenue streams are not one-dimensional either. We’re talking about:

  • Power generation from biogas
  • Cost share of reduced aeration requirements
  • Carbon credits
  • Eliminate cost of landfilling sludge
  • Terra Preta for soil enhancement (Terra Preta is an agricultural grade of charcoal that provides environmental benefits when applied to soils, including improved water retention and reduced fertilizer run-off.)
  • Algae for biodiesel production and biomass
  • Algae for high value products, like nutraceuticals, pharmaceuticals, cosmetics and bioplastics

BioEcoTek is now in the process of securing additional funding for project development. We will definitely be keeping a close eye on this one.


▼▼▼      4 Comments     ▼▼▼

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  • Erich

    To me, in the long run, the final arbiter / accountancy / measure of sustainability will be
    soil carbon content. Once this royal road is constructed, traffic cops ( Carbon Board ) in place, the truth of land-management and Biochar systems will be self-evident.

    A dream I've had for years is to base the coming carbon economy firmly on the foundation of top soils. My read of the agronomic history of civilization shows that the Kayopo Amazon Indians and the Egyptians were the only ones to maintain fertility for the long haul, millennium scales. Egypt has now forsaken their geologic advantage by building the Aswan dam, and are stuck, with the rest of us, in the soil C mining, NPK rat race to the bottom. The meta-analysis of Syn-N and soil Carbon content show our dilemma;
    http://jeq.scijournals.org/cgi/content/abstract
    and
    http://jeq.scijournals.org/cgi/content/full/38/

    The Ag Soil Carbon standard is in final review by the AMS branch at USDA.
    Contact Gary Delong . http://www.novecta.com 515-334-7305 office
    Read over the work so far;
    http://www.novecta.com/documents/Carbon-Standar

    In my efforts to have Biochar's potential included, I have recruited several to join the list, briefed the entire committee about char when issues concerning N2O & CH4 soil GHG emissions were raised, fully briefed a couple of the 50 members when they replied individually to my “Reply all” briefs. The members cover the full spectrum of Ag interest.

    With the Obama administration funding an inter-departmental climate effort of NASA, NOAA, USDA, & EPA, and now even the CIA is opening the data coffers, then soil carbon sensors may be less than 5 years away. I'm told by the Jet Propulsion Lab mission specialists responsible for the suite of earth sensing satellites, that they will be reading soil carbon using multiple proxy measurements in 5 years. Reading soil moisture to 3 foot dept in two year with SMAP, Reading GHG emissions and biomass from the tree tops down next year when the Orbital Carbon Observer (OCO, get it:) is rebooted, to 1 Ha resolution and don't even ask about the various spectrometric; lasers, UV, IR, lidars, temperature sensors, interferometry etc.

    Then, any farmer can click “Google Carbon maps” to see the soil carbon accounted to his good work, a level playing field to be a soil sink banker.
    The Moon Pie in the sky funding should be served to JPL
    Sowing Seeds With New Agricultural Carbon Accounting Tool Carbon dioxide emissions from agricultural activity in the United States can now be tracked with unprecedented resolution because of a method developed at Oak Ridge National Laboratory team led by Tristram West .http://www.sciencedaily.com/releases/2010/06/100602131436.htm

    Since we have filled the air , filling the seas to full, Soil is the Only Beneficial place left.
    Carbon to the Soil, the only ubiquitous and economic place to put it.

    Hope to see you at ISU for the 2010 US Biochar Conference

    Dr. Robert Brown <rcbrown@iastate.edu>, and the team in Ames Iowa are planing the next national biochar conference. The Conference will be June 27-30 in Ames Iowa Hosted by Iowa State University.
    http://www.biorenew.iastate.edu/events/biochar2

    WorldStoves in Haiti ; ( http://www.charcoalproject.org/2010/05/a-man-a-… ) and
    The Biochar Fund deserves your attention and support.
    Exceptional results from biochar experiment in Cameroon
    http://scitizen.com/screens/blogPage/viewBlog/s

    NSF Awards $600K to BREAD: Biochar Inoculants for Enabling Smallholder Agriculture
    http://www.nsf.gov/awardsearch/showAward.do?Awa

    Thanks for your efforts.
    Erich

    Erich J. Knight
    Chairman; Markets and Business Opportunities Review Committee
    US BiocharConference, at Iowa State University, June 27-30
    http://www.biorenew.iastate.edu/events/biochar2

    EcoTechnologies Group Technical Adviser
    http://www.ecotechnologies.com/index.html
    Shenandoah Gardens (Owner)
    1047 Dave Barry Rd.
    McGaheysville, VA. 22840
    540 289 9750
    Co-Administrator, Biochar Data base & Discussion list TP-REPP

  • http://profiles.yahoo.com/u/H5WD2ISDY5O7TLL5OR6MHT7UPE Dr A.

    Whereas technical problems, such as harvesting, are being addressed successfully by the industry, the high up-front investment of algae-to-biofuels facilities is seen by many as a major obstacle to the success of this technology.

    A study by Alabi et al. examined raceways, photobioreactors and anaerobic fermenters to make biofuels from algae and found that photobioreactors are too expensive to make biofuels. Raceways might be cost-effective in warm climates with very low labor costs, and fermenters may become cost-effective subsequent to significant process improvements. The group found that capital cost, labor cost and operational costs (fertilizer, electricity, etc.) by themselves are too high for algae biofuels to be cost-competitive with conventional fuels. Similar results were found by others, suggesting that unless new, cheaper ways of harnessing algae for biofuels production are found, their great technical potential may never become economically accessible.

    Dr.A.Jagadeesh Nellore(AP),India

  • Pingback: Breaking the Cost Barrier on Algae-based Biofuels()

  • http://profiles.yahoo.com/u/H5WD2ISDY5O7TLL5OR6MHT7UPE Dr A.

    Whereas technical problems, such as harvesting, are being addressed successfully by the industry, the high up-front investment of algae-to-biofuels facilities is seen by many as a major obstacle to the success of this technology.

    A study by Alabi et al. examined raceways, photobioreactors and anaerobic fermenters to make biofuels from algae and found that photobioreactors are too expensive to make biofuels. Raceways might be cost-effective in warm climates with very low labor costs, and fermenters may become cost-effective subsequent to significant process improvements. The group found that capital cost, labor cost and operational costs (fertilizer, electricity, etc.) by themselves are too high for algae biofuels to be cost-competitive with conventional fuels. Similar results were found by others, suggesting that unless new, cheaper ways of harnessing algae for biofuels production are found, their great technical potential may never become economically accessible.

    Dr.A.Jagadeesh Nellore(AP),India

  • Martin Tampier

    Have a look here for a realistic overview of algae & costs: http://www.dotyenergy.com/Markets/Micro-algae.htm

    M. Tampier, ENVINT Consulting (Canada)

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