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Public Support for Private Advancement

Industry leaders say more can be done
By Erin Voegele | March 19, 2012

The U.S. algae industry has made great strides toward technology improvement and commercialization, and some federal departments, most notably the Navy, have helped drive growth in this sector. The Navy is preparing to operate a Green Strike Group this year that is fueled with a 50/50 mix of biofuel. The use of algae-based fuel has played a large role in its evaluations. Solazyme was recently credited with delivering more than 95,000 gallons of algae-derived fuel to the Navy.

The U.S. DOE has also shown the sector support, including ongoing research and development under its national laboratory system. It was an important benchmark for the industry when the National Renewable Energy Laboratory revived its shelved aquatic species program. Also, a variety of cooperative research and development agreements (CRADAs) have been formed with private industry to help accelerate technology development.

It is important that biofuels, including those from algae, are supported by several top government officials. In fact, the day after President Obama’s State of the Union address, he traveled to Buckley Air Force Base in Aurora, Colo., where he spoke about the defense department’s need to transition to cleaner, domestic fuels. Obama specifically called attention to the fact that the Navy made the single largest purchase of biofuel in government history late last year. 

There are several specific actions other federal agencies can take, however, to further support algae advancement. One desire raised by many in the industry is to see more involvement by the USDA. A crop insurance program, for example, could help derisk algae cultivation and attract the traditional agricultural community to the industry.

The Navy has always been a force leading new energy technology development, and its role with algae-derived biofuels is no different. In addition to the obvious benefits of having one of the world’s largest fuel consumers pulling for your sector, important public relations benefits also stem from the Navy’s support of renewable fuels. Navy Secretary Ray Mabus, in particular, has been an outspoken advocate. He has repeatedly—and patiently—reiterated the many reasons why the Navy should lead the charge to develop domestically produced biofuels, often pointing out the vulnerabilities and cost variability associated with sourcing petroleum fuels from the global marketplace. For example, during a House Armed Services Committee hearing in February, Mabus was questioned about the relevancy of the “strong emphasis” the Navy has placed on its biofuels initiative. Mabus once again explained that purchasing oil products on the open market leaves the Navy open to unacceptable vulnerabilities associated with sufficient fuel supplies and price shocks that have increased Navy fuel expenditures by up to $1.1 billion per year.

Mary Rosenthal, executive director of the Algal Biomass Organization, says she appreciates the support that the Navy has offered the sector. “The testing, use and procurement of algae-derived fuels by the Navy, for instance, has been a huge help in generating awareness of the quality of these fuels among the aviation community,” she said. “Continued support in the form of funding, legislation and procurement will only help accelerate commercialization of algae-based fuels. The Department of Defense is a perfect ‘test bed’ for new technologies and products. DOD’s support for algae-derived fuels would be an important seal of approval.”

While the Navy has been primarily procuring algae-based fuel from Solazyme, which runs a fermentation production technology, many hope the Navy will expand its procurement to algae fuel from other companies employing different production technologies. “[The Navy] has gotten out ahead of the industry and sort of created a market for some of these fuels,” says Tim Zenk, Sapphire Energy Inc.’s vice president of corporate affairs. “Particularly, they have focused on algae generated from sugar. We hope the Navy recognizes that scalability really happens when you get beyond just fermentation and you liken algae production to large-scale agriculture.” 

The DOE has an extensive network of nearly two dozen national laboratories and technology centers in place. While these entities do extensive work in the realm of scientific research, many also benefit private industry through the development of CRADAs, research partnerships focused on developing commercially deployable processes or technologies.

OriginOil Inc. recently established a CRADA with DOE’s Idaho National Laboratory to codevelop an integrated system for direct conversion of raw algae into a renewable crude oil for use by existing petroleum refineries. The technology, dubbed the Biocrude System, would integrate OriginOil’s harvesting system with a biomass processing technology being developed under the CRADA. Paul Reep, OriginOil’s senior vice president of technology, says this is the second phase of an earlier effort in which INL helped OriginOil develop an understanding of energy balance modeling for its process technology. “INL has developed a sophisticated understanding of modeling and simulation technologies over the past several decades through its advanced nuclear energy programs, for commercial power and nuclear Navy program; a particular and recognized strength of the INL,” Reep says. “We have found INL to be responsive and pragmatic, and a perfect fit for a small company looking to get the exact technical expertise it needs for each specific project, without increased organic/internal staffing. The taxpayers pay for this expertise, and it’s industry’s opportunity to extract tremendous value from this national resource.”

While the ability to leverage the national laboratory system is obviously beneficial to the algae sector, industry leaders would like to see more DOE activity and support. Reep, for example, notes that a DOE-led Manhattan Project kind of effort would represent a big opportunity for the algae industry. Team and leadership are the watchwords that together form the culture needed to foster advancements that realized nuclear energy. “The DOE labs have the team—is there a leader up to the task?” he asks.

Rosenthal says the ABO would like to see the DOE continue to support algae R&D but shift focus away from lab-scale work and concentrate on activities that support scale-up and commercialization. “Specific areas of focus might include resistant strains, large-scale water and CO2 use, development of large open air ponds, circulating algae, dewatering, harvesting and conversion of wet algae into crude, changing strains effectively on a large scale to fit changing climate conditions, and refining into high-grade fuels,” she says.

Tim Burns, CEO of BioProcess Algae LLC, says he would also like to see algae take on a more significant role in the DOE’s Biomass Program. “[Algae] is going to be a crop,” he says, adding that to advance it in a proper fashion, health, productivity and yield advancements must be made.

While algae cultivation differs in important ways compared to traditional row crops, it is still a crop. As demand for algae grows, it’s likely the agricultural community will get involved. “If you look at what we do well in this country, we have had one surplus in one industry over the past 70 years and it has been in agriculture,” Burns says. “We are the farmers of the world. We need to take the same approach [with algae], and I think the USDA has great programs and a practical approach to the way it develops programs and gets programs to produce at scale. I think the USDA is a well-suited group to actually move this. Personally, I think it is best positioned to move the advanced fuel and algae spaces.”

Zenk says developing a crop insurance program for algae would significantly help the industry reach commercial production. “Farmers are a very conservative lot,” he says. “They also take a great deal of personal risk in that they own their land, and there are things that can wipe out their crops through no fault of their own. Crop insurance is a way to protect the farmer from these circumstances, and the same will be true with algae production, especially those of us who believe there is this nexus between energy, agriculture and biotechnology.”

The Biomass Crop Assistance Program is another USDA program that could help fuel expansion in the algae sector. “BCAP doesn’t treat algae the same way it treats terrestrial crops,” Zenk says. “We need to get the USDA to fully embrace [algae] as a new form of farming because of its potential to really bring large-scale energy development to the U.S.” USDA, he says, has an enormous role in this.

No matter how the specifics play out in the end policy-wise, the support offered by federal entities is clearly benefiting the algae industry. “It’s absolutely essential that the government continue to maintain the outspoken bravado around algae, and the value to the Department of Defense and the country,” Zenk says. “It’s got to be in our national interest to move the needle, and without that support, it isn’t going to happen.”

Author: Erin Voegele
Associate Editor, Algae Technology & Business
(701) 540-6986
evoegele@bbiinternational.com

 

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