Advanced Biofuels

Opinion: Algae Biofuels--A View From the Field

Date Posted: October 22, 2009

by Sam Nejame

The Algal Biomass Summit arrived in San Diego in the wake of the Exxon-Synthetic Genomics mega deal.

So, there was great anticipation for the keynote by SG’s wunderkind, Craig Venter.

With star power like that headlining many felt their industry had arrived... or at least might soon.

So, it was with some irritation that Venter stood up the 900 attendees to receive the National Medal of Science from President Obama (as deserved as it was).

A stand-in explained the deal, which pits the ambitions of Venter and his team against the significant obstacles inherent in algae cultivation.

Although some still grumbled the investment represented only a tiny percentage of Exxon’s expenditures for oil exploration, the potential $600MM injection is the largest single bet by an oil company on any next generation biofuel.

The mood from the convention center situated next to bobbing yachts and mothballed naval vessels was a mix of goldrush enthusiasm and pragmatism.

Those in for the longhaul placed algal fuel squarely in context - i.e the algae wave follows the near collapse of the ethanol industry, moribund biodiesel production, and the painfully slow buildout of cellulosic ethanol capacity.

And admonitions came from all quarters with investors and peers pleading with all not to overstate capabilities or time lines, lest they give the entire toddling industry a black eye.

Even among investors there seemed an increasing acceptance that the replacement of our fuel infrastructure, which took the better part of a century to build, will not happen overnight.

Bottom line.

The consensus to achieve algae commercialization (from those not drinking green Kool-Aid) hovered between 7 and 10 years.

A little tempering of expectations may not be such a bad thing.

The potential benefits of algal biofuel are certainly real - 100x vegetable oil yield per acre compared to the next best crop, production of oil and carbohydrate, a renewable non foodstock fuel source that doesn't require arable land or potable water.

To be sure continuing battles loom over tax incentives (algal derived fuels do not yet benefit), standards and proof algae culture is feasible on a grand agricultural scale.

Despite differing approaches and some sniping at the DOE, the masses in San Diego all hoped for one thing - that the explosion in algae investments will take the current cottage industry beyond nutraceuticals and food additives.

While it remains to be seen whether Synthetic Genomics systems biology approach will transform microalgae from vegetable oil accumulators to oil secreters as envisioned, it's a smart play.

Even if SG is unsuccessful, given that advances in biotechnology don't occur at predictable rates the combine armies of 60 domestic and 150 global algae companies might well shave years off the path.

True commercialization may be a decade away, but if you're livelihood depends on energy or agriculture you'll want to watch this space.

The future may arrive sooner than expected.

Sam Nejame is Founder of Promotum a management consulting firm specializing in technology commercialization and business development for fuels, chemicals and biologics.

He has an MBA from the Kellogg School of Management and a BS in Chemical Engineering from Worcester Polytechnic Institute.

His opinions can be read from time to time in the Biofuels Journal.

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