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Algae Business: Mixed-Cycle Production, the Growth Breakthrough
February 29, 2012
recent OriginOil study concluded that algae producers can make gasoline and diesel at their place of production for as little as $2.28/gallon, using a blend of algae and waste feedstocks. ($5.44/gallon using pure algae.) The model assumes a production footprint of at least 50 hectares (124 acres).
We provided further details on our analysis in a company presentation available at this link. (If you’re an algae industry insider, you can see the underlying model itself, in confidence. Just contact us at the Partners desk.)
Important note: the OriginOil End to End Algae Production Model referenced here is a preliminary study and numbers are subject to change. It is a theoretical analysis and final results will depend on proving at scale of a number of still-new technologies.
* Wholesale price is based on average price of gasoline and diesel (US, 2/20/2012) after cost of crude oil and refining, before marketing, distribution and taxes.
How are these numbers achieved?
Algae production has become a lot more efficient in this model, but the prospective gains are in three specific areas:
- Advanced growth techniques. These quite literally make the difference between profitability and loss.
- Increased harvesting efficiency. Harvesting, once a huge cost and energy drain, now potentially trails both fuel conversion and growth in both capital and operating expenses.
- Distributed fuel conversion into gasoline and diesel. A number of promising players are now on the scene with processes they claim can be deployed at algae production sites. They appear to have dealt with many of the issues we have been faced with on the pyrolysis front.
Of these three, Advanced Growth is the biggest jump.
What are advanced growth techniques?
There are promising developments from a number of players (including OriginOil) in the area of growth enhancement, but most of the prospective gain in our model comes down to one thing: the adoption of mixotrophic (mixed-cycle) growth.
What is mixotrophic production and why is it so great?
Normally we think of algae being grown either autotrophically (using light as an energy source) or heterotrophically (nutrition obtained by digesting organic compounds). So when we make algae in the sun, we are autotrophic. When we make it “in the dark”, we are heterotrophic. When we do both, we are mixotrophic.
Solar, or dark – or both?
In my previous column Algae—Food or Chemical Grade?, I explored the place that the dark cycle has in algae production, and concluded that it is best suited to making food-grade algae. And, algae made in the sun are more appropriate to making fuels and chemicals.
Now, advanced algae players are pursuing a hybrid solution: growing algae in the sun and then switching it to a boost phase, fed in the dark with organic compounds. If you’re making fuel, the feed on the heterotrophic side needs to be organic waste to make cost-effective sense.
Ken Reynolds, our VP Marketing, reviewed developments in this exciting area. Here’s Ken.
“As some algae producers have recently switched their focus from fuels to food and feed, it raises the question of what will it take to get to truly cost effective and sustainable biofuels derived from algae? Several recent AIM articles touched on the critical challenges and key opportunities for improvement.
Industry researchers discuss the mixed cycle
“Ron Pate of Sandia Labs provided what I think is a pretty accurate assessment of the current state of affairs regarding the use of algae as a feedstock or production platform for biofuels. In particular he discussed the benefits and limits for the two most widely used algae production methods (heterotrophic and autotrophic).
“In another recent AIM article, Dr. Richard Sayre, Director of the Enterprise Rent-A-Car Institute for Renewable Fuels and CTO of Phycal, also pointed out the need for better methods for algae production.
“In summary, while the potential for environmentally sustainable production could be high for autotrophic algae, it needs further improvements to achieve cost-competitive yields. The yields for heterotrophic growth on the other hand can be quite impressive, but there are major issues regarding the use of sugar and a fair amount of uncertainty as to the true timing, availability and pricing of sugars and starches from non-food sources.
“In the article, Dr. Sayre also discussed how mixotrophic production is being planned for Phycal’s planned Hawaii facility by using sewage and cassava as nutrient sources. There is no question that using waste to feed the algae in mixotrophic phase is the sustainable wave of the future.
“In some mixotrophic models, the algae is started as an autotrophic culture and then switched to a dark heterotrophic cycle to ‘fatten’ up. Another model that may prove to be equally or more effective is to grow the algae using a simultaneous feeding of CO2 and organic nutrients, with some level of light – but not necessarily full sunlight.
Productivity exceeding one gram per liter per day
“With mixotrophic production we start to see major cost improvements in the resulting biomass and lipid content. Based on lab and pre-pilot test results achieved by OriginOil partners and algae producers, we think mixotrophic productivity could easily exceed one gram of new biomass per liter of culture per day with very high lipid content.
“Note that while lipid levels can be quite high, we are using overall biomass as the primary point of comparison to account for differences across various downstream uses. Also, productivity is calculated based on culture volume rather than surface area as calculations used for autotrophic solar exposure become less relevant.
“This may seem quite high to those familiar with autotrophic growth and woefully low compared to heterotrophic output, but all productivity is relative to capital and operating costs. The key of course is to achieve the optimum productivity without competing with the food chain in the process. I tend to agree with Dr. Sayre that the mixotrophic approach may well be the most viable and sustainable solution in the long run, especially at the production volumes and price points required for biofuels.”
Thank you, Ken.
To conclude, I see two additional areas that mixotrophy affects deeply: considerations of land area, and how much sun we need.
Maybe we don’t need as much space
Based on figures that Aurora Algae provided in 2011 for its six-acre demonstration plant, large-scale pure photosynthetic growth generates roughly 200 kg of biomass per hectare per day. That appears to convert to about three-quarters of a barrel of fuel equivalent per day. Perhaps the science can do more, but will we get multiples of that? Perhaps, but then the costs start to escalate dramatically.
The affordable multiples we need may come from the mixed cycle, greatly reducing the acreage needed for viable fuel production.
We can make algae in the higher latitudes
The conventional wisdom for algae is that it only works in high-sun areas. This makes people in Sweden and Canada wonder how they are going to make algae industrially — meaning, year-round.
One answer might be, again, to mix the cycles, in varying ratios, according to the seasons.
Clearly, there’s lots of work ahead to make mixed-cycle production work for our industry, but the evidence in our model seems to indicate that mixotrophic production will be essential to algae production going forward.