Tony St Clair, the business manager at MBD Energy, was delighted when he was travelling through JFK airport in New York recently and saw massive banners from US oil major ExxonMobil promoting algae as a potential jet fuel. Finally, some public recognition.
Exxon is not the only one getting excited about algal fuel potential. Other international oil groups are also investing large sums, and so are the likes of Bill Gates. Qantas last month signed an agreement with a US company Solazyme – backed by Chevron and Morgan Stanley – to pursue a potential algae fuel supply, and algae is one of the principal topics at a special symposium on alternative jet fuels at Avalon Air Show near Melbourne this week.
Algae, though, seems to be emerging just about everywhere as a potential solution to myriad problems. It is now often cited not just as a major source of abatement for greenhouse gas emissions, but as a potential solution to food scarcity, and a source of biofuel that doesn’t impact food supplies. Julian Cribb, in is recent book, The Coming Famine, cited the potential of algae farms to convert waste nutrients and water into food, animal feed, fertilizer and fuel, as well as pharmaceuticals and fine chemicals.
Professor Ross Garnaut, in his report on land use changes, noted that algae had “especially attractive features” as a source for biofuels in Australia and trials had shown a reduction in methane emissions when it was used as a feed supplement for cattle. “Large volumes of biomass can be produced from relatively small areas of lake or sea water, including on saline land not suited to agriculture,” Garnaut wrote, noting that such farms would likely source their carbon dioxide supplies from the exhausts of fossil fuel combusted for electricity generation and from the blast furnaces of steel mills.
Garnaut notes, however, that further work is required to develop cost-effective, large-scale cultivation and harvesting systems, but he says there are prospects for producing algal biofuel on a large scale within five years.
The proponents of the algae solution say that it has saved the world once and can do so again. Many millions of years ago, it helped clean up what was then an inhospitable atmosphere by absorbing excess levels of carbon dioxide, and much of it sank to the sea floor or lake beds and began its slow transition into oil. “As far as nature is concerned this is nothing new,” Riggs Eckleberry, CEO of OriginOil, which is partnering MBD Energy in the creation of a series of demonstration projects at Australian generators, said in a recent interview. “Nature has done this many millions of years ago in producing the crude oil we’re burning today.”
The question is, can the process be concertinaed into just 24 hours, and who can do it most efficiently? More than 100 “serious” contenders are trying to find out, including a handful of Australian companies which are pursuing various technologies in the hope of achieving high yield at competitive costs. Some companies favour wild algae, some genetically modified strains, others want to grow local strains of algae in open ponds, and others in closed systems.
In Australia, several companies are getting busy putting their theories into practice. At Tarong power station in Queensland, a pilot plant being built by MBD Energy will combine MBD’s proprietary growth membranes and OriginOil’s unique extraction technology. The 1Ha “display plant”, which will use concentrated CO2 emissions from Tarong to produce oil-rich algae, will be in operation in a few months, and will be followed by a commercial-scale plant in 2013 and large scale plants in 2015. While many algae developers in the US are focusing on their fuel potential, MBD’s business plan is to sell 100 per cent of it as fuel, biomass, feeds and food. And it is looking to develop both micro strains (single cell plants, good for oil products) and macro-algae (multi-cell plants, a bit like seaweed, which are good for ethanol, food, feed and biomass).
MBD, backed by Anglo American and soon to secure another cornerstone investor, will use demonstration plants at Eraring Energy and Loy Yang – including one of up to 80 hectares – to test a range of algae strains and their suitability for various bi-products, including of course their ability to deliver on their principal raison d’etre, to capture emissions from the power stations.
A different method is being pursued in Nowra, where the recently listed Algae.Tec has commenced construction of a closed system at Manildra’s ethanol refinery. Algae.Tec proposes to grow algae in layered rows stacked in containers, with mirrors directing the sun rays towards the ponds.
Earl McConchie, the US-based chief operating officer and founder of the technology, says the fundamentals of algae production and the downstream conversion to renewable fuels is relatively “old” chemistry. But the optimal path to commercialisation does require step-changes in system design. While 80 per cent of rival companies are going to open pond systems, he is convinced that a closed system is the best way to have control, and to use less land and do it cheaper.
“There is a lot of confidence that algae is the right commercial answer,” he says. “If algae takes off there will be a huge market and plenty of room for many players. We’re not so worried about competitors who are successful as the ones that fail.”
Other companies in Australia pursuing development projects include Aquaflow Bionomics, which is looking at ways of harvesting wild algae that grows in municipal sewage ponds as a way of recycling water and creating biofuels – and applying the same technology to clean up waterways. An Adelaide firm called Muradel – a joint venture between Murdoch University, Adelaide Research and Innovation and SQC – has begun construction of a multi-million dollar pilot plant near Karratha to test its open-pond system. That is expected to be operational by July.
Dr David Lewis, from the University of Adelaide's School of Chemical Engineering, says it was important to show that commercial levels of algae could be grown without competing for resources with food crops, using non arable land and without any need for freshwater. He says the cost of producing biofuel from algae has already dropped from $12 a kilo to below $4 in the past year, but the aim is to get it down to less than $1 a kilo.
It's the fuel equation that interests Qantas most. The challenge facing the industry is outlined in a presentation to the conference by Nicole Williamson, from the airline’s climate change strategy and programs division. Australia’s petroleum self sufficiency is currently 59 per cent, but is likely to fall to 24 per cent by 2030 if no action is taken, and sustainable fuels (the phrase Qantas uses to describe the broader category) could account for 46 per cent of aviation fuel by 2020 in a best case scenario, and 100 per cent by 2050. Williamson notes that sustainable fuels are technically feasible, and certified (or close to it), and the economics are “improving.”
Qantas, which uses 89 per cent of turbine and diesel fuel consumed in Australia, says it is receiving many proposals for sustainable fuel joint ventures. It is reviewing others, but so far has chosen only two as part of its portfolio approach: one with US company Solena to pursue fuel from gasified municipal waste; and one with Solazyme, which Qantas estimates to be the closest algae company to industrial scale production, having already supplied significant quantities of fuel to the US Navy.
Incidentally, the Navy is among the most enthusiastic proponents of algae fuels. Last year, it conducted a test run with a 50 per cent algae fuel delivered by Solazyme on one of its small “fast boats” and now plans to have an aircraft carrier group – up to six ships – running on “green” fuel by 2016. That means an algae blend in ship engines and a version of mustard seed oil for aircraft.
The US Navy says having been on the forefront of the transition from sail to coal, from coal to oil, and oil to nuclear, it sees “green fuels” as a national security issue. “We don’t want to be reliant on one source of fuel, and we want to be an 'early adopter' of new technologies,” said Rear Admiral. Philip Cullom, director of the Chief of Naval Operations Energy and Environmental Readiness Division. As former California governor Arnold Schwarzenegger said in a speech to an innovation conference in Washington this week: “We’re not talking about some environmental weirdos, we’re talking about the Navy!”
Williamson says Qantas is equally willing to play a pioneering role, and says Australia is well suited to develop the technology, with a favourable climate, large land base, and R&D in efficient agriculture production; and it would benefit from stabilising aviation greenhouse emissions, regional development and ‘green’ jobs. “Australia represents an important opportunity for cleantech companies (although) clearly the key barriers to deployment remain economics and the establishment of a new value chain,” she says.
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