Pond scum could save the world

by Michael Richardson

Do we really need to keep pushing the frontiers in the search for oil? Must we venture into ever deeper and more dangerous waters, and into areas on land where technical challenges and political risks are rising? Some leading multinational energy companies evidently believe there may be a promising alternative much closer to home — algae, that slimy scum, often green or brown in color, that grows abundantly in oceans, along seashores, and in lakes, rivers and ponds, basically anywhere there is sunlight.

Exxon Mobil Corp said in 2009 that it would invest $600 million over the next five or six years trying to produce fuels from algae comparable to those refined from conventional crude oil. On July 14, it opened a greenhouse facility in California to grow and test algae.

Algae biofuels have several attractive features for investors and consumers. Unlike other biofuel sources such as corn, soybeans and sugar cane, algae do not compete with our food supply. Nor are they linked to the cutting and burning of tropical forests, as palm oil is in Southeast Asia. And because algae absorb huge amounts of carbon dioxide, the main greenhouse gas from burning fossil fuels, they could help reduce global warming.

Algae also soak up other pollutants, including oxides of nitrogen and sulfur, both components of acid rain. In addition, algae probably produce around three- quarters of the world’s net output of oxygen in the air we breathe.

Hundreds of firms, big and small, in the United States, Europe and Asia, as well as droves of research scientists and engineers are now involved in the quest to turn algae into a commercially viable fuel source.

Energy giant BP is planning to divest around $10 billion in non-core exploration and production assets to help pay for cleanup costs in the worst offshore oil spill in U.S. history in the Gulf of Mexico. Despite this pressure, the company recently announced a significant addition to its biofuels business in the U.S., saying it had invested more than $1.5 billion in since 2006. Exxon’s biofuel investment is just a fraction of its spending, which is set at $32 billion for this year alone. It is a small bet on a new fuel source for the future.

So are these just “alternative energy” sops by big oil companies to their critics, while they continue to focus the bulk of their resources on finding and producing conventional oil and gas? That may be part of the story. But the promise of algae as a renewable fuel source that can combat climate change and reduce industrial pollution makes these organisms hard to ignore. They are tiny biological factories that use photosynthesis to transform sunlight and carbon dioxide into energy so efficiently that they can double their weight several times a day.

As part of this process, algae produce oil. They can generate 15 times more of it per hectare than other plants used for biofuels. Although they come in many different strains and forms, algae are relatively simple organisms. They grow in salt water, freshwater or even contaminated water.

However, algae developers face major challenges and say it may take anywhere from a few years to a decade or more to overcome them. The challenges include sifting through thousands of species to find the right strain of algae that will produce high yields; designing systems in which the desired algae can multiply but other species will not invade and disrupt the process; and developing efficient harvesting methods to extract oil without damaging other parts of the algae that have useful and potentially profitable functions.

Regulating carbon emissions, making algae production less energy-intensive and cutting its cost will be critical to future success. U.S. researchers said last year they reckoned it cost about $56 per gallon (3.8 liters) to make algae biodiesel, but that as large-scale production techniques improved, the cost could fall to around $5 per gallon. The average retail price of regular diesel in the U.S. today is about $3 per gallon.

Earlier this year, American scientists published a study of pilot projects for producing algae in the past 15 years. It showed they consumed more energy, had higher greenhouse gas emissions and used more water than other biofuel sources such as switchgrass, canola and corn.

Still, the potential benefits remain great and production techniques are being refined. The most common ways of growing algae are in open ponds and enclosed containers called bio-reactors. The latter harness reflected sunlight so that algae growing on membranes can use plant photosynthesis to produce energy, with oxygen and water vapor as the only waste products. Martec Biosciences Corp in the U.S. formed a joint venture with BP last August to mass-produce a third algae production system, with fermenters that are four meters in diameter and five stories tall.

Meanwhile, Exxon has teamed up with Craig Venter, the U.S. genomics pioneer, to test whether large-scale quantities of affordable fuel can be produced from algae. Venter says that while thousands of natural strains of algae are being screened for qualities that would make commercial production cost-effective, the sheer number of requirements for success means that at some stage chosen strains will probably need genetic modification.

Welcome to the brave new world of bio-engineering that may one day free the U.S., Japan and other energy guzzlers from dependence on imported oil.

Michael Richardson is a visiting senior research fellow at the Institute of South East Asian Studies in Singapore.