The United Nations Environment Programme recently published its first Biofuels Assessment Report ever. Much of this assessment dealt with conventional biomass, and mostly, the report did a fine job saying some bio systems are good, some are not so, and much depends on how you do it. Global warming remediation and economics were dominant parameters, although water, state of the technology and other factors were considered.
Let me focus on what many think might be the most promising ultimate bio option. I've been surveying colleagues for several years now on biofuels from algae, and the speculations on potential cost are all over the map. But the potential is exciting, for it is said that you can grow several times (factor of two to ten, you pick a number) more biomass from an aqueous environment than on land. Mind you, this point remains debatable.
Part of the reason given is that terrestrial plants need to pass nutrients only through thin roots, defying gravity, while aquatic micro and macro species can use the total surface area. Plus, genetic engineering can more readily be applied for a micro system, which has an effective doubling time of hours, not weeks, months or years.
For this analysis, which comes in two parts, I will focus on microalgae grown in saline water on land. A follow-up article will review prospects for macroalgae (such as kelp), the form pioneered in the open ocean by Howard Wilcox as early as 1968, and now, mostly being investigated today by the Japanese. This early work mostly led to methane by fermentation and as feed for animals. Recent interest adds ethanol to the product mix. A fourth posting will blue-sky the prospects for actually attempting to utilize the effluent from ocean thermal energy conversion (OTEC) plantships to manage algal farms at sea.
My speculation is that terrestrial microalgal and marine macroalgal biofuels/feed systems are a decade away from commercialization if the price of oil by then exceeds $125/barrel. The combination of our sun, the ocean, microalgae, OTEC, and genetic engineering for sustainable marine biofuels (hydrogen, alcohols, biodiesel, etc.) is probably a generation or two away. This would be an element of the Blue Revolution. Thus, ultimately, there will be four postings.
I begun to be involved with growing algae in raceways a third of a century ago, and from then until now, have observed that federal funding was spotty and mostly non-existent. There was never a truly orchestrated national program and sporadic attempts at organization were thwarted by the fickle price of oil. There remain today too many unknowns and uncertainties, for the due diligence and science have not yet been performed. The fundamental engineering was never initiated, and remains a knowledge gap, for this work should proceed in parallel to someday mesh with the science. The National Science Foundation for the past few decades has tended to avoid funding energy projects, mostly a jurisdictional attitude in favor of the Department of Energy, but is finally beginning to recognize this deficiency and has initiated steps to take a more active role.
So let's get to the heart of the matter regarding terrestrial microalgal biofuels production: the eventual cost of production. In general, the price of crude oil is a good an indicator as any of what biofuels from algae facilities must meet to be competitive. Let us look at the numbers. Take crude oil at $80/barrel, or $1.90/gallon. A typical USA average these days is $2.73/gallon for regular gas. The ratio is 1.43, that is, gasoline costs 43% more than crude oil. (Prices change, and on November 27, this ratio was 1.48.) This ratio was 1.64 in 2008, 1.85 in 2007 and 1.92 in 2006. The differential accounts for profits, taxes, marketing, etc., and will drop as the price of crude oil rises, unless, of course, there are added taxes.
One way of looking at this is if the best industry can do is produce biofuels for $5/gallon, then oil needs to go up to $220/barrel. If the production cost can be reduced to $3/gallon, then, oil would only need to rise to $126/barrel. My gut feeling is that $3/gallon will only be attained with considerable R&D over a period of 10 years or more, and maybe never.
However, there are various mechanisms to foster the earlier coming of biofuels from algae. One is to link the project to pollution control and a range of bio-co-products, for algae has a lot of protein, something absent in terrestrial biomass. The added value factor can make that crucial difference, and this especially becomes obvious with the Blue Revolution. A second, more ethereal, potential introduces the matter of life cycle costing, for if the financing can proceed with the confidence that oil will rise beyond $150/barrel, with the added attraction of government incentives, these operations might well attain prominence relatively soon, even if oil might only be in the range of $100/barrel.