The Biofuels Digest's take on the recent EBI report that
concludes meaningful Algae commercialization will take 10 more
years.
California, USA --
In California, a new report from the Energy Biosciences
Institute (EBI) in Berkeley projects that development of
cost-competitive algae biofuel production will require much more
longterm research, development and demonstration.
“It is clear,” the EBI scientists conclude, “that
algal oil production will be neither quick nor plentiful
– 10 years is a reasonable projection for the R, D & D
(research, development and demonstration) to allow a
conclusion about the ability to achieve, at least for
specific locations, relatively low-cost algal biomass
and oil production.”
Authors include Nigel Quinn and Tryg Lundquist of
Lawrence Berkeley National Laboratory, Ian Woertz of Cal
Poly, and John Benemann. Benemann recently made the
Digest’s Top 100 People in Bioenergy list.
“Even with relatively favorable and forward-looking
process assumptions (from cultivation to harvesting to
processing), algae oil production with microalgae
cultures will be expensive and, at least in the
near-to-mid-term, will require additional income streams
to be economically viable,” the authors noted in a
release highlighting their findings.
The “10-years away” Theme: A Gathering of
Outlooks
There are a wider assortment of algal fuel
commercialization timelines than crayons in a big
Crayola box, but there are a couple of studies that have
come out from academia of late that focus on the 10 year
horizon. Phil Pienkos, Al Darzins and Eric Jarvis at
NREL recently
wrote in IEEE Spectrum: “our projections suggest
that in the next 10 years or so algal biofuels will be
able to compete economically with crude oil costing
between $75 and $100 per barrel.”
But this report from EBI is the most comprehensive
survey to date that we’ve seen on the economics, and
technical challenges for algal fuels.
That’s also the horizon we see in the work at
Sapphire Energy, which is constructing a 1-million
gallon demonstration scale facility by 2014, and expects
to be at commercial scale production with a 100 million
gallons facility by 2018 and at 10 such facilities by
2025. ExxonMobil and Synthetic Genomics, in their
communications, emphasize the long-term nature of their
R&D work on cyanobacteria-based fuels.
Key Finding: Demonstration-scale Plants Are
“Premature”
The authors conclude that “the building of
100-hectare demonstration plants, with investments of
tens to hundreds of millions of dollars, are premature.”
Don’t Despair
There are a couple of items that must be noted in
this study, for those who despair over the gloomy
scenario.
First, the authors go into exhaustive and impressive
detail on the current cost scenarios, limitations of
current technologies, and the resource limitations in
California and elsewhere in terms of appropriate sources
of light, CO2 and land. That’s what makes this
foundational study a complete “must-read”.
However, there isn’t any forward modeling on how fast
the costs will come down. The source of the authors’
conclusion on the 10-year scenario is simply a
scientific wild-ass guess, in which the authors note the
10 year timelines cited by Shell, ExxonMobil, NREL and
the UK’s Carbon Trust. Essentially, they are re-tweeting
undocumented timelines, rather than analyzing them.
Proteins Zeroed in Value
Second, the authors chose to discount the value of
proteins down to zero, predicting that the market for
high-value feed “would likely be saturated before
significant biofuel quantities were produced, while
commodity animal feed co-production would not likely
have a decisive effect on biofuel production costs
without other production improvements in addition.”
Hmmm, we respect the argument about saturation, but
we don’t agree that an esteemed researcher’s “say-so”
should be the accepted level of proof required on a
critical point of inflection. We note that in other news
today, reports that up to 5 million tonnes of additional
fishmeal will be needed by 2020, above current global
consumption. That could well support up to 700
million gallons of fuel production (assuming a 30
percent oil content) – not an insignificant amount of
fuel, and that’s before considering the growth in demand
for animal feed. Or serving algal feed to animals or
fish to meet current demand.
Strategies Not Considered: Solazyme, Algenol,
PetroAlgae
Among the players that are making faster commercial
strides are three companies with an alternative route to
value, Solazyme, Algenol and PetroAlgae. In the case of
Solazyme, they are growing heterotrophic algae (feeding
sugar to algae that grow in the dark), not the
phototropic algae considered in the study. In the case
of Algenol, they are capturing ethanol secretion from
cyanobacteria, which are grown in closed
photobioreactors. In the case of PetroAlgae, they are
producing a protein concentrate and fuel precursors from
lemna, or duckweed.
The presence of alternative strategies is not proof
that progress will comes faster – in each case, the
success of Algenol, Solazyme or PetroAlgae will depend
on the quality of the technology, which is in part based
on undisclosed intellectual property. Not to mention the
availability of financing for large-scale biofuel
projects in general. But it is important to note that
almost all scenarios for a faster commercialization of
fuels made from algae and related platforms involve
commercialization of one or more of the competing
technologies than those considered in this study.
The Futurist’s Conundrum and Parkinson’s Law
One difficulty we have noted elsewhere in the
discussion of the commercialization of algal fuels, and
raised by the authors of this report: “Ten years is a
short time for development of any novel technology, but
a very long term for a venture capital fund…which
perhaps explains the differences between the
venture-backed firms and projects funded by larger
companies and governmental organizations, which may be
able to take a somewhat longer view.”
What the authors are getting at is that your view of
the timeline appears to depend less on the science and
more on Parkinson’s Law, as stated in a 1955 essay in
The Economist:
“Work expands so as to fill the time available for
its completion.”
Parkinson, in a subsequent book, humorously compared
the time it took a prototypical retiree to mail a letter
to the time required by a busy executive to complete the
same task.
In the case of algae, organizations that depend on
R&D for their livelihood are usually found projecting a
need for more R&D. Conversely, organizations that depend
on investor dollars for their livelihood project a need
for more investment in commercialization, and project
fast(er) returns.
One note: It would be useful if the organizations
that do R&D in this field would refrain from doing
assessments of the need for more R&D. No matter how
rigorous the work, there is an inherent conflict of
interest in asking the researcher to model how much more
R&D is needed.
The Digest’s Take
Having said that – the study itself, as an
examination of the current state of play, is without
parallel among the generally available studies on the
economics and current science of algal fuel production.
A must-read on that level.
But we’ll not consider that a 10 year horizon is a
reasonable projection — just as we discount the “just
around the corner” scenarios — until the parties reason
and document the case.
Jim Lane is editor and publisher of Biofuels
Digest.
This article was originally published by the Biofuels
Digest and was reprinted with permission.