Algae are the kind of organisms that can invade a body of water and kill nearly all the fish in it. Many people think of them as a nuisance and an environmental threat. But biotech companies are eyeing the organisms as a lucrative resource.

Algae grow at incredible rates. Some can double their population twice a day by feeding on a little carbon dioxide, sunlight, and nutrients. During this process, algae can produce oil and scientists are doing everything they can think of to capitalize on that: they’re genetically manipulating algae, feeding them sugars and smokestack emissions, growing them in racetrack-shaped ponds and enclosed plastic tanks, and experimenting with strains from exotic locales. 

The goal is to hone algae into efficient producers of oil and other products that can be fashioned into fuels, chemicals, and neutraceuticals. The technology is available, but the real challenge is economically scaling up production so that large quantities can be sold for cheap. No one has been able to do that yet, although dozens of companies and academics are trying.

Genetic manipulation of algae, one of the hottest avenues, is rife with both possibility and controversy. Engineered strains could be highly efficient and tailored to produce specific substances. But like other genetically modified (GM) species, if they aren’t contained, they pose a threat to their surroundings.

“You could destroy a whole ecosystem,” says David Bayless, a researcher at Ohio University. But GM strains are at risk from natural algae as well, and companies working with engineered algae have incentive to keep them in enclosed tanks. “If you’re going to all the trouble of genetically engineering an organism, you don’t want a competing strain to come in there and take over,” says Bayless. “So I don’t see much of an option other than closed systems.”

Anastasios Melis, a biologist at the University of California at Berkeley, is genetically tinkering with green microalgae to improve their ability to produce hydrogen, a potential fuel source. During photosynthesis, microalgae naturally convert sunlight into a small amount of hydrogen. The top layer of algae often absorbs all the sun, however, leaving the lower layers in the dark and limiting their hydrogen production. Melis and his colleagues are designing algae that absorb less sunlight, so that more light penetrates to the deeper layers.

Of course, with biotech tools, you can design a system that eliminates the need for sunshine altogether. Solazyme in South San Francisco is employing synthetic biology and genetic engineering to design algae that feed on sugars rather than the sun and produce oils through fermentation. The company is also testing unique natural strains from peat bogs in Ireland and swamps in Malaysia.

“You can make a lot of oil feeding an algae sugar, but that sugar is expensive,” says Bayless. “Fuel has to get a lot more expensive for that to be competitive,” he says. Solazyme plans to first market their oil products to cosmetics and neutraceuticals companies, which pay more for specialized oils.

Algae can also produce precursors to gasoline- and diesel-like fuels. Dubbed “green crude,” the product is chemically identical to molecules in regular old crude oil and can be refined into high octane gasoline. Sapphire Energy in Sonoma, California is developing algae with this capability, and experts have hinted that some of their organisms are genetically engineered—information the company has not yet publicly confirmed.

A far cheaper way of producing fuel products from algae is to grow natural strains—without genetic modification. Hawaii-based HR Biopetroleum in July announced a collaboration with two local utility companies to build an algae-to-biodiesel operation. A portion of the power plants’ carbon dioxide emissions will be captured and fed to natural strains of microalgae growing in enclosed vessels and open ponds, says Ed Shonsey, CEO of HR Biopetroleum. With the carbonated kick, the algae will grow so quickly that the company will drain the ponds every 24 hours and extract the oil. 

A refiner will convert the oil to biodiesel, and the utility companies will likely buy the fuel to power their facilities, says Shonsey. “Hopefully it will decrease electricity rates for local residents,” he says. The system is expected to be running by 2011.

GreenFuel Technologies has tested its algae system on emissions from fossil-fuel burning facilities in Arizona, Kansas and Louisiana. The company selects natural strains of microalgae suited to the composition of the emissions, and cultivates them in enclosed systems, called photobioreactors. The algae’s lipids, or oil, can be converted into biodiesel, its carbohydrates to ethanol and proteins to animal feed.

Finding utilities with enough adjacent land for algae farms can be tough. And convincing the utilities to collaborate on such projects is even tougher. Power plants don’t like to disrupt their operations, says Ron Putt, a researcher at Auburn University in Alabama. “Utilities that say ‘Here, take our flue gasses’ are few and far between,” he says.

Since there’s already so much unwanted algae in the world, growing more makes some people a little uneasy. Nitrates from agricultural fertilizers trickle into waterways, causing algal blooms that choke oxygen out of the water and kill plants and animals. Nearly every week local officials report new infestations. Last month, for example, officials reported invasions in the Potamac River in Maryland, Glady Fork in Virginia and the Yuba River in California.

One solution is to collect ‘nuisance’ algae and convert it into useful products. Seattle-based Blue Marble Energy in August was awarded a contract from Washington State Department of Ecology to collect wild algae around Puget Sound. Blue Marble is working on a technique that converts wild algae into a natural gas-like product and then into green crude. The company is also experimenting with growing algae in wastewater from treatment plants—a cheap source of nutrients.

Researchers have been studying algae fuels extensively since the 1970s and still no one is producing them cost efficiently. In 1996, a federal program focused on algae run by the National Renewable Energy Lab was shut down, largely because crude oil prices were too competitive. The lab reopened the program last year. Now that oil prices have topped $100 per barrel, maybe this time things will be different.

Story by Emily Waltz. This article originally appeared in "Plenty" in September 2008.

Copyright Environ Press 2008