GreenFuel Bites the Dust

I have written several articles over the past couple of years that argued that there is a low probability that any of the would-be algal biodiesel manufacturers are going to make it. These essays included:

More Reality Checks for Algal Biodiesel

The Prospects for Algal Biodiesel Dim

In both essays, I mentioned GreenFuel Technologies, which arose out of research done at MIT, and was the highest-profile company (and very well-funded) working on algal biodiesel. As far back as two years ago I put up a guest post by John Benemann who seriously questioned what GreenFuel was claiming:

Algal Biodiesel: Fact or Fiction?

Like CWT before them, GreenFuel could also serve as a poster child for hype gone amok. They were winning awards for innovation and had gushing articles appear in the mainstream media – but some of us recognized that they were stretching the truth.

Of course one of the first to call attention to GreenFuel was Krassen Dimitrov, whose analysis pointed out that their claims violated various laws of thermodynamics. Ironically, a poster dropped by to call Dimitrov a quack based on his analysis of GreenFuel, which I often summarize this way: Based on first principles of solar insolation falling on a square meter of land, the maximum algal biodiesel yield you could expect to get from organisms that utilize photosynthesis is around 1 gallon/square meter/yr. Not only do photobioreactors cost over $100/square meter (so you are paying $100 capital to produce 1 gallon per year), but GreenFuel was claiming that they could get 11 gallons/square meter/yr.

Well, the laws of thermodynamics have now caught up with them:

GreenFuel Technologies Closing Down

The Harvard-MIT algae company winds down after spending millions and experiencing delays, technical difficulties.

GreenFuel Technologies, one of the earliest, best funded and most publicized algae companies, is shutting its doors, a victim of the credit crunch.

“We are closing doors. We are a victim of the economy,” said Duncan McIntyre at Polaris Venture Partners, which invested in Greenfuel.

I imagine we are going to be hearing “victim of the economy” every time one of these hypesters runs out of money. It is the convenient excuse. The rest of the article gets closer to the heart of the matter – and highlights many of the issues raised by “the quack” Dimitrov:

The company has also been chronically saddled with delays and technical problems. The company’s plan was to pump carbon dioxide from smokestacks into bioreactors – i.e., sealed plastic bags filled with algae and water. The algae would grow fat on the carbon dioxide and later be harvested by GreenFuel to be turned into oil for biodiesel. Protein and other matter from the algae would also be sold to pet food manufacturers.

Getting the whole thing to run smoothly, though, was tougher than expected. GreenFuel could grow algae. The problem was controlling it. In 2007, a project to grow algae in an Arizona greenhouse went awry when the algae grew faster than they could be harvested and died off. The company also found its system would cost more than twice its target.

So, Krassen has the last laugh, and investors would have been wise to heed the various warnings. Don’t feel bad, Krassen, as I have had posters who said I didn’t know what I was talking about when I suggested that Bill Gates’ investment in Pacific Ethanol was going to turn out badly, which of course it did. If you are like me you don’t enjoy seeing anyone fail, but you do like knowing that you got it right.

GreenFuel was the first high profile algal concern to go under, but they won’t be the last. I predict that few of them will be standing in just a few short years. Growing algae is trivial and can be done in water, and there is the allure. Turning into biodiesel is not technically very difficult. Doing it all economically is next to impossible. I have had one very prominent algae expert tell me that it will be at least 15 years before there are serious prospects for commercial viability – and that will require multiple large technical breakthroughs.

Footnote: Incidentally, I don’t see that gathering and extracting the oil will ever be cost effective. But I can see three possibilities of algal strategies that might work. If algae could be designed to weep oil, which could then phase out of water, that might be a workable approach.  The separation of algae from water, and then of oil from algae are very energy intensive steps, and if you could just skim oil you would knock out a lot of the costs.

I also haven’t written off the fermentation approaches of companies like Solazyme. Think of the Brazilian ethanol model, only with algae fermenting longer chain hydrocarbons from the sugars.

One final possibility would be if the oil is merely a by-product from either a system that has another primary function (i.e., sewage treatment) or has a primary product that is of much greater value (like a pharmaceutical). In either of those approaches, the capital and operating costs don’t have to be solely supported by the algal fuel.

24 thoughts on “GreenFuel Bites the Dust”

  1. The Israelis looked hard at algae in the previous oil price spike, back in the 1970-80s. Came up with nothing.
    It seems like biofuels, with the exception of palm oil, or other oil trees, are just not viable. Not enough calories, or BTUs, or oomph to warrant the effort. Ethanol we will have forever as it is a farm subsidy.
    On the other hand, doomsterism due to the lack of viability of biofuels is also not warranted. We have a 120-year supply of natural gas, and that is only if we do not find any more or figure out better extraction techniques. Probably enough for even longer.
    We have cars that get 50 mpg, or even more (PHEVs).
    Actually, sometimes I think oil is destined to become a backwater industry. OPEC has a real challenge ahead: Keep supplies reliable and cheap, or watch the world pass it by.
    As it is, I think we have seen Peak Demand. China will go ahead with BEVs. The USA demand will fall for generations. Europe and Japan will consume less every year.
    Probably we will see CNG fleets, and then one-off vehicles, in the future. That is doom? Bring it on, I say.

  2. More negativity from RR. The US is the world leader in producing biofuel. You would think RR could mix positive lesson learned with the failures.

    How about a ratio of 1 positve story to each negative one? By positive, I do not want some Pollyanna next big thing but stories of progressive small step improvements like we are seeing with corn ethanol.

    Just trying to make your blog better RR.

  3. The problem is not just the thermodynamics of solar algal oil production. Coors BioTech studied heterotrophic algae production back in the 70s. It is cheaper than phototrophic, but still not cost effective. The problem is that even dense algae cultures contain less than 100 g of biomass per liter of water, and only a fraction of that biomass is oil. A California company called Solazyme is trying to commercialize the heterotrophic algal oil approach now. They will follow GreenFuel into the dustbin of alternative energy. And they will probably blame the economy when they do.

    RR, the critical analyses of alternative energy schemes in you columns are the best on the web. Do not feel obligated to provide positive stories along with negative stories. Just keep callin em as you see em.

  4. “How about a ratio of 1 positve story to each negative one?”

    Kit, it still isn’t clear to me why you don’t just start your own blog, since you have so many opinions on how one should be run. I have some ideas that would work well for you. Here is a good positive/negative mix for you to consider:

    GreenFuel Technologies Set to Dominate the Algal Biofuel Sector

    Follow up with:

    GreenFuel Goes Bankrupt

    Then, you could go with:

    Changing World Technologies: The End of Oil Dependence

    Follow up with:

    CWT Declares Bankruptcy.

    Finally, you could do:

    Pacific Ethanol: The Perfect Investment?

    Follow that one up with:

    Bill Gates Loses Shirt on Pacific Ethanol

    Just trying to be helpful.


  5. King-
    A good speech by the Questar man–although in truth he does not refute AGW, he only rebuts it.
    Personally, I am more worried about another Ice Age, so I am not so concerned about AGW. But just saying that AGW is, or is not, real doesn’t answer the question.

  6. More negativity from RR.
    More BS from Kit. Can’t you take a hint, Big Mouth?

    When you have nothing to say, it is better left unsaid…

    How about a ratio of 1 positve story to each negative one?Not being much of a journalist, I guess you might have failed to notice that negative stories are more newsworthy. For example, if one out of a hundred companies go bankrupt, which headline will sell the most papers?
    Otion 1: Acme closes its doors after X years in business.
    Option 2: 99% of local business appears to be doing fine.

    Think it over, Kit. You might learn something.

  7. There over a thousand plus places trying to make biofuel and I bet over a thousand different methods they are using. Most will fail and some will suceed.

    There are some interesting things
    in algae with a path perhaps to economic and technical viability.

    origin oil seperation advamce

    Algae and Budgets

    We now have a number of technical tools not available 10 years ago in terms of computer tools, new materials and biotechnology techniques.

    I predict something is going to work amazingly that will cause some big positive changes in our energy situation (perhaps not in algae)I just can’t say what, where or when……

  8. “But just saying that AGW is, or is not, real doesn’t answer the question.”
    The real issue is that we have real problems.

    You don't have to be a Doomer to recognize that fossil fuels are finite, or that they currently provide over 90% of global energy. And of course, even if alleged Anthropogenic Global Warming were real, the finite nature of fossil fuels would solve that problem before too long. Alleged AGW is a time-wasting distraction from the real issues.

    It is disappointing to see algal processes bite the dust. At one stage, I was very hopeful about them.

    We need to get serious soon about building nuclear fission plants — and designing a new generation that can safely be exported to developing countries.

    And, for the longer term, we need to boost Research & Development spending on a very broad range of other energy supply alternatives — there will be many disappointments before humanity finds the perfect blend of post-fossil fuels.

  9. King, I got this same memo when I worked for a company that was big in natural gas and using it to make electricity.

    “Turns out that the market has found a way to cut CO2 emissions without driving the price of electricity through the roof – natural gas’s share of the electricity market is growing, and it will continue to grow – with or without cap and trade.”

    There is a problem with this theory. It is not true on several levels. If you take a old SCGT producing a 1000 MWe and upgrade it to a CCGT that produces 2000 MWe, it is a great theory. This theory also hold for improving the efficiency of coal and nuke plants. That task is mostly done.

    However, when you start build a new CCGT capacity to increase the market share of NG; then the ghg emissions skyrocket. As does the cost of NG, and therefore the cost of electricity. There used to be an ample supply of NG at $1.50/MMBTU. Now there is an ample supply of NG at $4.50/MMBTU but that is only because the recession and mild weather has reduced world demands for NG. Currently NG fuel cost for generation is twice that of coal.

    So ask the folks in California and Texas about the high cost of massive increases in ghg. It is not the small fraction of renewable energy that is causing rate increases.

  10. Ben – I didn’t say he refuted AGW, he just presents a pretty good case that the proposed solutions won’t work.

    Kit P – gas is $4.50 now. Chesapeake claims they can add trillions of cubic feet of shale gas reserves at $5-6. Right now gas combined cycle dispatches out ahead of coal at $50/ton. Questar is just saying that gas is part of the answer.

  11. In 2007, a project to grow algae in an Arizona greenhouse went awry when the algae grew faster than they could be harvestedAt first blush, this seems like, kind of, a “high quality” Problem.

    Well, gasoline HAS been cheap, and this has been a tough time for entrepreneurs, trying to get started; so, we’ll see.

    I wouldn’t, Completely, write off algae, just yet, though.

  12. “Micro-ethnanol plants info perhaps of interest to some.”

    Capital costs seem unreasonably low. Typically an ethanol plant costs $20-$30 K per daily barrel of production. That second unit comes in at $7000, assuming you actually can produce at the suggested max of 60 gallons/day.

    Energy return would be quite interesting to have. I would like to get a guarantee on that number. That may be the fatal flaw, but if the energy return isn’t too bad, I might like to experiment with one of these systems.


  13. “Questar is just saying that gas is part of the answer.”

    Yes King, I know what they are saying. It is not true if you are interested in low cost electricity and reducing ghg gas.

    “Right now gas combined cycle dispatches out ahead of coal at $50/ton.”

    Where? Where is the this mythical place? What is the spark spread at this place? What kind of coal?

    Not where I live King, not by my utility. Making electricity with NG can be very profitable. You people in Texas and the loons in California have not problems with high energy bills.

    The problem with your utility making electricity with NG it makes energy mores expensive and cost Americans lots of jobs. While creates a few jobs in Texas along with imported LNG.

    So King NG companies tell the same lie over and over does not make it true. Sure you convince college kids of anything but King you are too old and too smart to buy that line. Try again and this time consider the whole country.

  14. Re: GreenFuels, “The algae grew too fast to be harvested” is a true but disingenuous statement. Like most sensible organisms (modern humans being a frequent exception), when nutrients are plentiful, algae reproduce prodigiously. When nutrients are scarce, they sequester energy (as lipids in this case, just as with humans) as a way to hunker down and survive through the lean times. When nutrients are below some critical threshold, of course, they die. With oil-bearing algae, one of the tricks is to grow the colony to a high cell density (reproduction), then get the algae to stop reproducing and start sequestering oil by limiting the nutrients … but not too much! In GreenFuel’s big demo, apparently they could not control the nutrients well enough to prevent a Malthusian population explosion. So yes, they grew a lot of algae, but they didn’t make much oil. Any lazy idiot with a backyard swimming pool can do that.

    One possible issue with productivity numbers, and I don’t know if this happened here, is that the developers quote areas for “footprint” rather than “shadow.” For a simple pond, of course, the two numbers are the same. But for companies that go vertical, as GreenFuels tried to do, sometimes they report the square footage that a bioreactor itself will occupy, rather than the average square footage that it will place in the shade. The latter number is the “fair” one, of course, since only insolated land is productive, but such claims are the stuff that dreams (including the dreams of venture capitalists) are made of.

    – The BioFool

  15. To my ‘anonymous’ drive-by friend. Personal attacks are not permitted. If you have a point to make, please make it. But do study up before you make clueless statements like “everyone else made money on GF.” That doesn’t even make a little sense. Nor does it make sense to suggest that “investors knew the risks.” They most certainly did not. The risk is close to 100%, while the potential for success is close to 0%. The only reason anyone invested is the technology was exaggerated.


  16. RE The BioFool

    Who are you calling a lazy idiot? My backyard pool is full of algae right now. The reason is that it is too cold to open it. Normally I get it opened much sooner than this, but this year is unprecedented. I think that my pool opening schedule is an excellent proxie for global temperature, and the date keeps getting later every year. If I plot it out, it would look like a hockey stick with the blade pointing down. Ice age is coming.

  17. Does anyone have any info on what Sapphire Energy’s magic secret of Algae oil production is.

    I’ve done as much Googling as I can, but haven’t turned up much.

    They don’t tell you how they plan to produce algae (open or closed cell etc..) or even what their unique approach is.


  18. "The problem with making protein in conjunction with substantial amounts of biofuels is that it will be produced in such large amounts that will likely saturate the potential markets3."

    Looking at ref 3:

    "3 p256 of NREL’s report on biodiesel from algae."

    Looking at the cited page:

    "One example for coproducts comes from fuel ethanol production from corn, which is economically dependent on animal feeds (distillers dried grains), byproducts for economic viability, in addition to the more than $1/gallon in subsidies. Indeed, only large byproduct markets, such as animal feeds, could be realistically considered in the context of biodiesel production. However, although it may be possible to coproduce proteins with algal lipids, such an optimization (e.g., for high protein feeds) is likely to be difficult. Another major problem, as in distillers dried grain, is the drying costs. Overall, higher-value feed coproducts cannot, and should not, be a major driving force in developing this technology."

    Note: Benneman et al said nothing about market saturation.

  19. Anonymuous on May 15 brought up experiments by Coors BioTech in the 1970s, when genetic engineering was barely a few years old and long before genome mapping became possible — it's hard to see how their results would be very predictive 40 years later in the era of synthetic biology. It's also a bad bet to assume that titers won't improve. Additionally, he writes: "The problem is that even dense algae cultures contain less than 100 g of biomass per liter of water, and only a fraction of that biomass is oil," implying that only a small fraction is oil, when it's actually very high — half or more as been achieved, IIRC. Finally, the assumption that Solazyme will live or die on biodiesel ignores the specialty chemical product streams they are working on, some to come out this year — volumes are small, compared to biodiesel, but value added is much higher.

  20. Who is going to manufacture it. Is there any would-be algal biodiesel manufacture? But no doubt, this does wonders in encouraging sale of small, green-fuel efficient vehicles.

  21. Why are the high starch algae strains neglected and so much attention has been diected at oil strains.

    Give me a high starch (90+) content and bio-butanol will appear.

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