Today’s episode of QUEST features our 10-minute TV story about efforts to produce biofuels from algae. In 1996, when the U.S. Department of Energy concluded its 25-year research project into the potential of algae as biofuels, its report concluded that the most cost-effective way to grow algae was in open ponds. With climate change and geopolitics prompting new research into the algae-as-fuel question, some companies are pursuing the open pond route, while others are looking into closed systems such as bioreactors. In our TV story we profile OriginOil, a Los Angeles-based company developing a bioreactor that looks like a miniature Christmas tree, complete with bright, colored lights. And we interview the CEO of Aurora Biofuels, a company based in the Bay Area city of Alameda, which is re-imagining open ponds, as well as trying to create strains of algae that are ideal for fuel production. Before becoming the CEO of Aurora Biofuels, Bob Walsh worked at the oil company Shell for 25 years. Here’s an excerpt of QUEST’s March, 2009, interview with Walsh, most of which didn't make it into the TV segment.
QUEST: What excited you about algae?
BOB WALSH: I ran oil products businesses for many years and understand the cost-competitiveness and the commodity basis of it. And what excited me about algae was, A, it’s renewable. B, you're using a feed stock of carbon dioxide, which is basically free. And finally, what excited me about this company, Aurora Biofuels, was the aspect of solving it end to end, not just the biotech (end of things), but also the engineering aspects.
Q: What has algae been grown for in ponds in the past?
WALSH: Algae’s been grown in open ponds for decades. And typically it’s been done with nutraceuticals – spirulina, which many people use as a protein pill. That is grown in open ponds, but not very cost-effectively because they haven’t had to be very cost-effective. They can charge $10 per pound.
Q: What would be the difference that you would be looking for in terms of cost-effectiveness, compared to what’s been done already?
WALSH: Historically, algae were just grown in an open pond and captured carbon dioxide (CO2) from the atmosphere and the sun. What we’re actually doing is injecting the CO2 we recover from a steel mill or power plant, to give the algae food. And we’ve engineered it to get better mixing, so it grows more quickly. And then finally, rather than drying the algae out, we actually do a wet extraction of the oil, which is much more cost-effective than drying it as they have historically done for proteins.
Q: So what price would you be aiming for, and what price can the algae be grown for now?
WALSH: Oil today has been around $50 per barrel. We believe we need to be competitive in the $50-60 range. And that’s what our final target is. I think oil will be $60-100 over the next 10 to 15 years.
Q: What would the algae biofuels facility of the future look like?
WALSH: You’ll situate it very close to a CO2 source – a steel mill or a power plant. It will encompass several thousand acres of barren land – because you want dry, barren land – and use salt water. And it would produce roughly 120 million gallons a year of useable fuel into the existing infrastructure.
Q: Can algae fuel actually make a contribution to our transportation needs?
WALSH: Algae can be a player. It’s going to take a lot of different solutions because of the different climates and things that you need for it. It’s also a trillion-gallon market. And so it’s not going to happen tomorrow. But certainly algae can be a 5- to 10-percent player in ten years, in the marketplace.