Pike Research: Algae-Based Biofuels Production To Reach 61 MGPY by 2020

RenewableEnergyWorld.com Editors
October 27, 2010 | 6 Comments

Algae has been getting a lot of attention lately as the U.S. continues to seek ways to effectively wean itself off its dependence on foreign oil. According to an announcement today from Pike Research, algae yields 2 to 20 times more oil per acre than leading oilseed crops and don't interfere with the food supply, making algae a good place for research and development.

According to a new report from Pike Research, algae biofuels production will grow rapidly over the next decade, reaching 61 million gallons per year and a 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%, roughly on par with early development in the biodiesel industry.

Of course many hurdles remain like the fact that algae has not yet produced any oil for commercial production and has very high production costs.

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,” said Clint Wheelock Pike Research president. He adds 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.

Pike Research anticipates that, with 50% of all algae activity, the United States could ramp up production the earliest among world markets. Pilot- and demonstration-scale facilities are beginning to break ground across the country.

The European Union (EU) market, which has about 30% of algae activity, will be limited initially by the industry’s focus on university research, and later by insufficient access to water, land, and nutrient sources. Latin America and Asia Pacific, which are home to fewer projects in operation today, are set to gain significant market share in the long run.

An Executive Summary of Pike Research’s study “Algae-Based Biofuels” can be downloaded for free.

6 Comments

Jim Van de Wetering
November 2, 2010

I attended a Renewable Energy Summit sponsored by the Imperial Valley (CA)Economic Development Committee this past March 2010 where I hear a rep. from SunEco which is operating an algae "production" complex in Niland, CA where they claim that they are currently producing diesel oil for $40.00 / bl. A much different story than I am hearing above.

David Doty
October 30, 2010

Pike here is very disappointing. This algae "study" is pure crap. Absolutely nothing substantive. Ok. I didn't pay $3500 for the full study, but I did read the Exec Summary, from which is perfectly clear that the authors are clueless about both the economics and the science. There has been a serious study, based on recent peer-reviewed literature, freely available for some time here:
http://dotyenergy.com/Markets/Micro-algae.htm
I update it whenever something substantive is reported.

The demonstration from more than a decade ago of about 400/gal/acre/yr still stands as the record for actual lipids harvested over a two year period from an area of more than half an acre. It cost them about $40,000/gal.

A peer-reviewed paper in a recent issue of Science notes that the current mean global price of dry algae is $300,000/ton.

Solazyme has been selling algal oil to the Navy for over $400/gal, but they are not using photosynthetic algae. They are using algae to turn biomass into oils. Their CEO says photosynthetic algae would be over 100 times more expensive.

I think Seambiotic is still the only company in the free world actually producing photosynthetic algae at much more than beaker scale.

Sapphire is the only company I know of actually spending serious money on photosynthetic algae, but they won't release any real info. I expect them to go the way of GreenFuel before they produce more than a few hundred gallons of fuels.

Pike is projecting the first facility producing 1Mgal/yr of algal fuels to come online between 2014 and 2016. I have seen nothing yet that tells me there will ever be production of fuels in quantities of more than a few hundred gallons per year from photosynthetic algae. If anyone can point to some real data to the contrary, I'd love to see it.

Anyone interested in a real solution to sustainable, carbon-neutral fuels should find the material on Windfuels at the Doty Energy website of interest.
http://dotyenergy.com/index.htm

Kim Hanna
October 29, 2010

people will not be swimming in algae ponds. I doubt there's a problem with algae fuels.

Kim Hanna
October 29, 2010

Enfield, New Hampshire - June 9, 2009

Researchers at Dartmouth-Hitchcock Medical Center have been looking into Lou Gehrig's disease and a potential link to the illness nearby. Nine people living near Mascoma Lake in Enfield, N.H., have been diagnosed with the illness in the past 20 years. But more research is needed to know whether a disease cluster really exists.

Roger Barnes grew up in Enfield spending his summers on Mascoma Lake. For two decades it's been a special place for him.

"You know it's got the mountains, Shaker Mountain on the western side, plenty of places to hike. Especially with the lake there is plenty of fishing," Barnes said.

But what else may be in the water besides fish has caught the attention of researchers at Dartmouth-Hitchcock Medical Center who are mapping out clusters of ALS-- or Lou Gehrig's disease-- a disease that attacks nerve cells in the brain and spinal cord.

"In mapping out the patients we noticed that there appeared to be a fairly high density of ALS patients around water bodies," explained Dr. Elijah Stommel, a neurologist.

Stommel says certain algae blooms produce a neurotoxin that may trigger the disease. The blue-green algae can be fatal to animals and should be avoided.

"If you see an active bloom in the water, which is like a green scum of the surface of the water or you hear of one, swimming in the water is probably not a good idea," Stommel advised.

According to Enfield's Health Inspector, no blue-green algae blooms have been spotted on Mascoma Lake this year.

Statistics show that the prevalence of ALS here is about 25 times greater than national norms. However, according to Dr. Stommel, there is no direct link between the disease and the lake, and there is no cause for public alarm.

"We certainly were not looking to scare anyone who lives near water and there is probably some necessity to have a genetic predisposition," Stommel said.

Back at the Barnes summer home, this native Granite Stater is worried more abo

Frederick Gralenski
October 29, 2010

This is such a boondoggle. So in 2020 they will produce 61 Million Gallons per year worth 1.3 Billion bucks? Isn't that $21.31 per gallon? That's probably the production costs, but subsidies and suckers will get the price down to $3.
Biofuels should be only the product of reducing sewage and other wastes, as any green plant is so very inefficient at harvesting the solar energy. Start there and then see what you can get out of it.
I never heard of any relationship to ALS.

kent beuchert
October 27, 2010

There is potential disaster when dealing with algae. It has been suspected for years as a method of causing ALS (lou gehrig's disease) in humans. Why hasn't the Fed regulatory apparatus looked into this?

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