Domestic Fuel

RAND National Defense Research Institute has released a study today amidst a firestorm of criticism with many claiming that the report sounds like an advertisement for the coal industry. The study, commissioned by the Department of Defense, was to conduct an examination of alternative fuels for military applications. For the past several years, the military has been testing alternative fuels, including biodiesel and algal fuels, in aviation and marine applications and has set clear goals to use alternative fuels by 2016 and beyond.

The report concludes that in the short term, “considering economics, technical readiness, greenhouse gas emissions, and general environmental concerns, FT fuels derived from a mixture of coal and biomass represent the most promising approach to producing amounts of alternative fuels that can meet military, as well as appreciable levels of civilian, needs by 2030.”

The report continues by saying, “It is highly uncertain whether appreciable amounts of hydrotreated renewable oils (biodiesel) can be affordably and cleanly produced within the United States or abroad.” The report questions whether renewable fuels can ramp up to commercial scale, be economically competitive and it questions their ability to reduce greenhouse gas emissions. All of these issues rule biodiesel and algae out, where too much money and resources are being spent, according to the report, as being a viable candidate to meet the military need’s over the next decade.

If these findings weren’t enough to stir up the hornet’s nest, the report also called for Congress to reconsider the military’s budget for alternative fuel-projects. This is a sure-fire way to invoke debate in Washington, especially as a Republican Congress searches for ways to cut the federal budget.

In a New York Times article, the report elicited quick criticism. “Unfortunately, we were not engaged by the authors of this report,” said Thomas W. Hicks, deputy assistant secretary of energy for the Navy. “We don’t believe they adequately engaged the market,” he said, adding, “This is not up to RAND’s standards.”
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This year will be the year of bio-based chemicals made from algae … that according to the CEO of OriginOil, algae-to-biofuel maker.

Riggs Eckelberry made the prediction on MoneyTV, an internationally-syndicated weekly business television program.

“2011 is the year of biochemicals made from algae.”

OriginOil on MoneyTV, 6 Jan 2011 from OriginOil on Vimeo.

Eckelberry says some major players in the algae-based biochemical business have received funding, especially in the plastics field. He says utilities will also be a big catalyst behind the growth of algae use.

“A power plant is never going to grow algae. They make power. So, for them, it doesn’t work unless an integrator that comes in and does all the engineering and operation. And those are the key players that are going to come into the market.”

Eckelberry points out all the things that use petroleum, such as plastics and fuels, can be substituted with the renewable oil from algae. Plus, the algae can also be used as a nutritional item.

He adds that his own company will be focusing on the oil extraction from algae process.

Confined Animal Feeding Operations (CAFOs) could be the key for algae-to-biofuel operations becoming commercial-scale… that according to Thomas Byrne, president and CEO of Byrne & Company LLP, a renewable energy project developer.

This article from Biorefining Magazine says the potential is greatest in northern climates, where anaerobic digesters that use microbes to break down the organic forms of nitrogen and phosphorous into inorganic forms… usable by algae:

“The methane produced by the anaerobic microbes is burned in a generator to produce an export of electricity and also waste heat that can be utilized to raise algae year-round,” Byrne says. “Bioreactors to grow algal species are well suited to take both the inorganic forms of nitrogen and phosphorous from the digester, as well as the waste heat and carbon dioxide (CO2) from the generator, to produce ideal inputs for algal growth.”

While the idea of co-locating an algal biomass growing facility with an established CAFO is a very real possibility, Byrne notes that the amount of algae grown for commercialization on a CAFO is limited by the availability of the CO2, nitrogen and phosphorus. “The limitations are both from what the CAFO produces, and what is needed from other operations of the CAFO.” Some bioreactor technology, like that of Algaedyne’s, which uses a process that controls photosynthesis by injecting only Photosynthetic Active Radiation into the depth of algae vessels, would make the process more feasible.

Byrne will be talking about the feasibility of a CAFO and algal biomass operation at the 2011 Pacific West Biomass Conference & Trade Show, Jan. 10-12 in Seattle.

A Florida company is building the world’s first large-scale, vertically integrated algae-to-biofuels facility.

This article from Florida Trend, which goes in depth on that state’s algae-biofuels industry, says Orlando businessman Nick VandenBrekel’s Agrisys will be growing algae to turn into jet fuel and biodiesel, as well as omega-3 “fish oil.”

Scaled up, VandenBrekel envisions a host of 1,000-to-20,000-acre farms across the Southeast where algal fuel is grown, processed and used locally, from community gas stations to diesel fleets such as school buses. Success, he says, would create no less than a “rebirth of American agriculture.”

Like Agrisys, a troop of other Florida companies — including PetroAlgae of Melbourne; Algenol of Bonita Springs; AquaFiber of Orlando; and Algae Aviation Fuel of Sarasota — sees the same promise in algae as a source of biofuel. Algae grows faster than any other potential crop, reaching maturity in less than 24 hours. As it grows, it devours CO2, generating oxygen as a byproduct. Most important for its potential as fuel, algae produce lipids, which store energy as fat.

The Florida firms all boast unique algae strains or proprietary processes they say can make fuel.

Agrisys, for example, has developed or licensed technology for growing and processing its algae in partnership with a research institute called CEHMM and a private technology firm called ARA, both in New Mexico. VandenBrekel says researchers there have been able to squeeze 125 gallons of oil daily from 1,000 gallons of algae-water mix piped from five acres of ponds.

The article goes on to say the biggest issue is making these operations profitable. Maybe they should listen to our latest Domestic Fuel Cast and see if some of that technology would help.

The developer of technology that turns algae in to renewable fuel is going down under to do some long-term testing of its process.

OriginOil recently announced the successful completion of the first phase of its commercial pilot program with Australian company, MBD Energy, OriginOil’s first customer and pilot partner. In this edition of the Domestic Fuel Cast, we talk to OriginOil’s CEO, Riggs Eckelberry, about his company’s testing of its algae-to-renewable-fuel technology in an in-the-field, real-world situation.

“We were looking for one of our pilot customers that would enable us to scale up our technology in real conditions.”

Eckelberry says his company’s bread and butter is focusing on extracting all that water from the algae and then extracting the oil by a process that he describes as “shocking” the algae. This testing should take several years with Eckelberry hoping at the end of the day, his technology will prove successful.

This announcement comes on the heels of the news that OriginOil has another project in the works, this time a little closer to home. The company will help build a new Advanced Algae Center with Sustainable Resources, Incorporated on the site of the original Aquatic Species Program in Roswell, New Mexico, scheduled to start sometime next year. Eckelberry jokes that they’ll even hold a job fair for any little green men who might be visiting Roswell to work at the facility.

Hear more from Eckelberry on both these projects in the Domestic Fuel Cast here. Domestic Fuel Cast

You can also subscribe to the DomesticFuel Cast here.:

Algae-to-biofuel maker OriginOil, Inc. has been tapped to help build a new Advanced Algae Center devoted to algae commercialization … growing little green microbes where little green men were once rumored to have landed.

This company press release says Sustainable Resources, Inc. (SRI) has agreed to contract with OriginOil to plan and deploy the new center on the site of the original Aquatic Species Program in Roswell, New Mexico, scheduled to start sometime next year:

“We just didn’t have the time to reinvent OriginOil’s expert team and sophisticated modeling in the short time available, which made the expense a no-brainer,” said Joe Ortiz, CEO of SRI. “We are also very excited that they intend to use our facility for their own commercial testing and to integrate with other technologies.”

“We are happy to devote our hard-won expert resources to help SRI build a world-class testing and piloting platform for the long term,” said Riggs Eckelberry, OriginOil CEO. “Because we plan to integrate our technology into others’ systems rather than distributing it ourselves, we are focused only on partners who will help us prove ourselves in the field. SRI’s Advanced Algae Center fits our focus perfectly, complementing our first commercial partner, Australia’s MBD Energy.”

Roswell, New Mexico was once the headquarters for the US Department of Energy’s Aquatic Species Program from 1978 to 1996. It is also rumored to be the site where a UFO crashed in the late 1940s. No word if ET plans to be at the new center’s ribbon cutting.

There just might be gold in algal biofuels and the team from Scripps Institution of Oceanography, based at the University of California San Diego (UCSD-SIO), is intent on finding it. UCSD-SIO has been researching micro and macro algae (seaweeds) for their potential to produce biofuels for more than 40 years. Researcher Greg Mitchell believes the search will be well rewarded in the benefits it will provide the country including offering solutions for energy security, hunger, water use, land use, biodiversity, and climate.

Seaweeds, a macro form of algae, hold great promise because of their potential for very high yields and high oil production while thriving on non-arable land. Another benefit is that they grow well in saline water. Traditionally crops will not excel in salt water and in some areas of the country valuable agricultural land has been taken out of production due to high concentrations of salt.

But as all researchers know, not all algae is created equal. There are strains of seaweeds that hold great promise for bio-energy and others that hold great promise for producing other products such as high protein meals for replacing non-sustainable ocean-caught fishmeals in aquaculture and other animal diets.

In fact, many algae companies that began with the mission of producing algal fuels have now refocused on producing algae products for the pharmaceutical, plastics, health, and agricultural feed industries. For example, there are strains of seaweeds that UCSD-SIO has been studying that grow well inland and can be used to recycle artificial seawater and waste nutrients from chicken ranches or pig farms. Algae has also been used in farm fish operations from cleaning the ponds to providing feed.
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According to the National Alliance for Biofuels and Bioproducts (NAABB), a considerable breakthrough has been made with the production of biodiesel using oil extracted from algae. The consortium’s algal biodiesel is meeting fuel specifications set by the American Society for Testing and Materials (ASTM).

The algal oil was provided by Eldorado Biofuels, and the oil was converted to biodiesel by Catilin, Inc., using their commercially available T300 solid catalyst. Whereas conventional conversion methods use highly caustic materials such as sodium hydroxide, Catilin’s technology produced the algal biodiesel that both meets ASTM standards more efficiently and economically while at the same time produced a highly purified glycerin. Glycerin is a highly valuable byproduct that is used by the food and pharmaceutical industries.

“We are very pleased to have demonstrated that our catalytic process is effective for algal oil feedstocks. Not only are the conversion costs reduced relative to the conventional process but the quality byproducts produced in the process will open additional markets,” said David Sams, vice president, business development for Catilin.

Eldorado Biofuels CEO Paul Laur noted that his company is happy they could provide the algal oil to help move the algae biofuels industry forward, and Jose Olivares, NAABB’s executive director said, “This step represents a major success and illustrates the high level of interaction between members which is a good sign that we are starting to reap the benefits of the consortium concept.”

The consortium’s next step is to distribute samples of the ASTM algae based biodiesel among members for the follow-up analyses necessary for engine emissions testing.

Algae Biofuel Maker OriginOil, Inc. has found a way to produce hydrogen from the power of the sun at a level comparable to solar photovoltaics.

This company press release says the breakthrough could prove to be a highly scalable and renewable source of hydrogen that can come from algae production:

To achieve this breakthrough, OriginOil researchers built a pared-down version of the company’s Hydrogen Harvester™ and tested many process variables and materials. They achieved hydrogen energy corresponding to a solar energy conversion efficiency of about 12 percent continuously for several hours on a partially clouded day. The sole energy input was the Sun. By comparison, commercial solar cells achieve conversion efficiencies between six and 20 percent.

Brian Goodall, OriginOil’s CTO, said: “Our experiments clearly demonstrate that this technology can generate renewable hydrogen at rates that matter to the global economy. These early rates compare well with those of the more mature solar cell industry, with the added benefit that the fuel, hydrogen, is readily storable. This is the first renewable source for today’s $39 billion hydrogen market.”

OriginOil officials admit the in-the-field efficiency might be less than the 12 percent achieved in the research system. However, since algae stores up energy during the day, it will continue to generate hydrogen throughout the night. Also, algae production facilities using a Hydrogen Harvester could be self-sufficient for refining.

In an update to a story from last week, the U.S. Navy successful tested an algae biodiesel blend in its pilot Navy Riverine Command Boat at the Naval Base in Norfolk, Virginia. The renewable fuel was provided by Solazyme, who has a contract with the U.S. Navy to provide them with 150,000 gallons of advanced biofuels made from algae. All of Solazyme’s Soladiesel diesel fuels meet ASTM, EU and military specifications.

“Solazyme is proud to provide the first microbially derived ship fuel used by the Navy in a military boat,” said Solazyme CEO and Co-Founder Jonathan Wolfson. “The United States Navy’s commitment to reducing dependence on fossil fuels has taken another step forward today and we applaud their leadership. We are honored to be a part of Navy’s efforts to reduce its reliance on fossil fuels.”

Solazyme believes it’s technology will help the Department of Defense reduce its carbon footprint, combat global climate change and lead in the development of clean and renewable energy sources.

According to a new report released by Pike Research, algae biofuels production will reach 61 million gallons per year with a corresponding market value of $1.3 billion by 2020. While barely a drop in the bucket for biofuels, this represents a compound annual growth rate (CAGR) of 72 percent, roughly on par with early development in the biodiesel industry. The study, “Algae-Based Biofuels,” examines the key growth drivers behind the algae-based biofuels market and outlines unresolved supply challenges. The report includes detailed 10-year market forecasts, segmented by world region, along with analysis of market conditions in key countries and profiles of key industry players that are shaping the emerging algae biofuels business.

Early research has given preview to algae’s advantages for fuel production including its ability to yield 2 to 20 times more oil per acre than leading oilseed crops. In addition, it doesn’t utilize non food-based feedstock and can grow on non-arable land and in wastewater, including salt water.

“On paper, algae could displace worldwide petroleum use altogether, however, the industry has yet to produce a drop of oil for commercial production,” said Pike Research President Clint Wheelock. “Although the algae-based biofuels market will grow rapidly once key cost hurdles are overcome, widespread scale-up will be hampered by a number of difficult challenges including access to nutrients, water, and private capital.”

Wheelock added that with the cost of production still a key obstacle to widespread production, many companies are refocusing production efforts on low-volume, high-value co-products to develop revenue streams over the next decade.

The report anticipates that the U.S. will lead the way in early production with nearly 50 percent of algae activity happening in the states. Next in line is the European Union, which is home to about 30 percent of algae activity, but their efforts will will initially hampered by the industry’s focus on university research, and later by insufficient access to water, land and nutrient sources. Over time, the report anticipates that Latin America and Asia Pacific will gain significant market share.

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Sapphire Energy has four pillars that define the company; yet the over arching pillar that truly drives them is the concept of scale. But before they could begin overcoming that challenge, they first had to decide what kind of company they wanted to be. The answer  – an energy company.

Sapphire is an energy company that just happened to land on algae as their primary feedstock. The company was founded in 2007 out of Scripps Institution of Oceanography at UC San Diego under the research direction of Steve Mayfield, who has since become the director for the San Diego Center for Algae Biotechnology, also housed at UC San Diego.

According to the company’s Vice President of Corporate Affairs, Tim Zenk, whom I met with during my San Diego Algae Tour, Sapphire is a very large operation. They have their research headquarters in San Diego, an engineering team working out of an office in Orange County, CA, a very large demonstration plot in Las Cruces, NM, and they are about to break ground on a very large demonstration facility in Columbus, NM.

“This is a very large lab by algae standards,” said Zenk. “It’s no question its the largest in the world.”

To date, Sapphire has raised more than $200 million from private investors, with three major investments coming from family venture funds. “Three family wealth trusts gives us a lot of flexibility that allows us to pick the right partners and allows us a long runway to develop the technology and commercialize it,” explained Zenk who believes the company will be at full production by 2018.

He noted that standard venture capital isn’t really conducive to energy. “We think of things in 30 year life cycles, not five years,” said Zenk.

Zenk described how Sapphire sees the energy problem. “We really view this as an agricultural problem and we see Sapphire at the intersection between biotechnologies, agriculture and energy. And our view is we need to learn something from the two most scalable businesses in the world and that’s energy and ag. Our view is algae can be cultivated in the same manner as, or in a similar manner, as you do other products that grow in water,” concluded Zenk.

And this leads us to the four pillars of Sapphire, which according to Mike Mendez a Co-Founder of the company and the VP of Technology, they are developing an energy solution that is scalability, is not produced from a food crop, does not use arable land, and does not use fresh water.

You can learn more about Sapphire’s four pillars in my interview excerpt with Mike Mendez. Click here to see photos from my San Diego Algae Tour Photo Album”>San Diego Algae Tour. Sapphire's 4 Pillars to Success

If you want to help the biodiesel industry, a California company says you should take health food supplements, particularly Omega-3s.

SmartPlanet.com reports biofuel maker Aurora Algae says the algae it grows for its biodiesel production can also be made into a high-value food supplement:

It intends to use algae to produce high-concentration Omega-3 fatty acids for use in pharmaceutical and health supplement products, use algae protein extracts as a food supplement, and to sell its remaining biomass as fish meal.

The company intends to expand its business by leverage algae as a commodity like soy to expand its business to enter the biofuel market within the next five to ten years, Bafalis explained. “Having those higher value products gives us the margins we need to go out where the costs and yields are in this industries now, and then build mass facilities and get costs down.”

The shift by the biofuel company to its pharmaceutical line is reflected in its name change last month. It used to be known as Aurora Biofuels.

CleanTech San Diego has been ranked in the top 10 of global clean tech clusters. Pretty amazing considering that the organization was only founded in 2007 through an initiative of the mayor’s office and several local businesses. The organization that created the ranking, Sustainable World Capital, has created a global clean tech organization of which CleanTech San Diego is a part. In November, the European component of the cluster will be launching in Finland, followed by the North American cluster in mid-to late November.

I asked Jason Anderson, Vice President of CleanTech San Diego during my San Diego Algae Tour, why the city felt that developing not only a clean tech cluster, but an algae cluster was so important. I should mention that San Diego has the largest algae cluster in the world – nearly 30 companies strong. Anderson responded that the city saw a clean tech cluster as a new opportunity for San Diego in terms of job creation and job growth for the region. Anderson noted that the cluster continues to grow and it has already had a positive impact on the region’s economy.

There have been folks in the region doing algal research for more than 20 years, said Anderson in response to my question, why an algae cluster? He said with the country’s interest in the price of fuel and energy security playing a big role, having a focus on algal fuels made sense.

So how did CleanTech San Diego come to be so successful in so short a time? Anderson said there were three reasons.

1. 1) The strength of the research institutions in their region including University of California, San Diego, San Diego State and Univeristy of San Diego.
2. 2) The people in San Diego are very collaborative and work together well.
3. 3) The leadership of Mayor Jerry Sanders and his region wanting to develop this and working hard with the business community and others to grow the industry.

You can view photos from my trip in my San Diego Algae Tour Photo Album.

You can listen to my interview with Jason Anderson and learn in more detail why CleanTech San Diego continues to be so successful.CleanTech San Diego A Global Top 10 Clean Tech Cluster

There will be a Wrigtht Brothers reenactment on Friday as the U.S. Navy prepares to fuel a boat with biofuels. Okay, so I fibbed a bit in the lead….it’s a boat, not a plane, and the boat will be fueled by biofuels and not jet fuel, but you get the point. The full power demonstration of a Riverine Command Boat (experimental) powered by a blend of 50 percent algae-based biodiesel and 50 percent NATO F-76 fuel will be groundbreaking. And in case you’re wondering, this bit of history will take place on October 22, at Naval Base Norfolk, Virgina.

“Our primary mission for Navy energy reform is to increase warfighting capability, both strategically and tactically. From a strategic perspective, we are reducing reliance on fossil fuels from unstable locations,” said Rear Admiral Philip Cullm, Director of the Chief of Naval Operations Energy and Environmental Readiness Division (OPNAV N45), which leads the Navy’s Task Force Energy. “Tactically, efficient use of energy resources extends our combat range and use of non-petroleum fuels assures multiple supplies are available.”

The Naval Sea Systems Command’s advanced fuels program office is leading the tests and demonstration for all alternative fuels used for the U.S. Navy. The office is also working in coordination with the Task Force Energy Maritime Working Group, supports the Secretary of the Navy’s efforts to reduce total energy consumption on naval ships.