Algae to fuel. The green muck that scares kids thrives in non-potable water, derives its primary source of energy from solar radiation, and consumes what we don’t want in our air, CO2. It sounds like a great idea. It just seems too good to be true. I do not question the science behind the concept, algae can be made into fuel, but what I do question is whether or not the plan is financially viable.
To get fuel from algae we basically have to mash it up, puncture it, or somehow break the cell wall to get the oil out. We have to juice it. The process of converting algae to fuel may be analogous, in principle, to creating orange juice.
Orange juice is made in a series of steps: Harvesting, Cleaning, Extraction, Concentration, Reconstitution, Pasteurization, and Packaging. Some of the steps to turn algae into fuel may be different but I wouldn’t be surprised if it shared many of the same. According to a recently placed phone call to a local grocer current orange juice prices are as follows:
128 oz Tropicana – $5.95 equivalent per gallon price – $5.95
89 oz Simply Orange – $4.98 equivalent per gallon price – $7.16
128 oz Hill Country – $2.50 equivalent per gallon price – $2.50
The lower prices show that algae oil might be competitive with gasoline costs on the current market. But hold on, the lower prices shown for orange juice are the cheapest around. It is probably only analogous to compare to the 100% orange juice for the exact same reason that you don’t want someone diluting the gas you put in your car. So now were talking >$6 per gallon of algae oil. Conventional crude oil is approximately $1.71/gal for a $72 blue barrel. Furthermore, oil is not gasoline until it is refined. With current gasoline at approx. $2.50/gal, there is a 46% increase ($2.50/$1.71) in the cost of oil per gallon to refine and ship the product to the consumer as gasoline. Consequently, the consumer will have to pay at minimum $8.76 ($6*1.46) for a gallon of gasoline derived from algae.
This isn’t the end of the issue though. One estimate puts the heating value of algal oil at approximately 115,000 Btu/gal. Typical North Sea crude oil has a heating value on average of around 125,000 Btu/gal. Thus, one would obtain around 50,000 Btu per dollar of expenditure (125000/$2.50) on conventional gasoline while only around 13,000 Btu per dollar (115000/$8.76) for algae derived gasoline. Even if the above analogy of juicing oranges overstates the cost of algal oil by a factor of 2-3, the costs of deriving energy from algae will most likely be so prohibitively high that its production will depend heavily on the public’s generosity to subsidize it.
Since we may run out of readily accessible oil in the next 100 years or so one could argue that algae could find a place on the market. I just don’t see it happening with the general consumer in the near future. The Department of Defense, however, may be willing to throw the money at it to ensure our fighter jets stay airborne. I feel sorry for my kids who’ll be looking at that energy bill as it comes down the pipeline.