Algae fuel has long been discussed as a viable biofuel alternative to gas and diesel, but until now no companies have been making it in bulk and selling it to regular car drivers. The month-long program is meant to test consumers’ responses to the alternative fuel, and the algae fuel will be sold at the same price as diesel at these locations. Algae fuel is generally currently more expensive than diesel.

The so-called Soladiesel uses a 20 percent blend of the algae oil, and can deliver a 20 percent reduction in carbon emissions, a 30 percent reduction in particulates, and a 10 percent reduction in THC.

After nine-years, an IPO and $125 million in venture funding, Solazyme finally broke into biofuels in a more commercial way this Summer by beginning construction on a biofuel plant in Brazil through a joint venture with Bunge. The plant is supposed to be operational in the fourth quarter of 2013, but Solazyme has been producing it on a smaller scale for awhile.

Solazyme engineers efficient algal strains and grows its designer algae in fermentation tanks without sunlight by feeding it sugar. Then, using existing industrial equipment, it extracts the oil. Solazyme has long maintained that it has wanted to commercialize its fuel technology in the 2013 time frame, with a production cost target of $60 to $80 per barrel. Seems like it’s getting there.

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Propel said it’s gotten $10.9 million from federal and state coffers to build 75 biofuel stations, starting with the three that have been completed recently (Oakland, Fremont and South San Jose). The three stations marked Propel’s foray into the Bay Area, and the company is working on new stations in downtown San Jose, North San Jose, Berkeley, Palo Alto, Redwood City, Livermore and Concord.  The company is ponying up $16 million for the overall California project, money that comes from the $20 million it raised earlier this year, said Matt Horton, CEO of Propel.

The company also operates six other stations in the Sacramento region, along with six more in Seattle. The California stations peddle both E85 (85 percent ethanol, 20 percent gasoline) and biodiesel. Horton declined to divulge the costs of building and operating these stations, but assured us that they are less than the costs for regular gas stations of comparable sizes. For one thing, Propel leases instead of owns the land. In the Oakland station, for example, the Propel fuel pump takes up a portion of a Chevron station (and the signage for its biofuel prices comes with a “Not a Chevron Product” disclaimer).

The ethanol for Propel’s fuel is coming from states such as Oregon and Idaho, Horton said. California used to have several ethanol production facilities, but they closed because of the rough economy and an overly optimistic belief that consumers would embrace biofuel-enabled vehicles (called flex fuel vehicles) in droves. The federal government mandate to increase the amount of ethanol consumed nationwide through 2022 promised to create a huge market. But the enthusiasm has been tempered by the realization by many ethanol producers and investors that developing and commercializing next generation ethanol at scale is extraordinarily expensive.

Meanwhile, the federal government has devoted a lot of attention and money to plug-in hybrids and electric cars. Just yesterday, the Environmental Protection Agency unveiled two proposed fuel economy labels that would address the rise of electric vehicles and the requirement to include on the stickers information about the car’s tailpipe emissions.

Horton said despite the hoopla, electric cars will not quickly take over the garages across the country, so biofuels remain an important solution for the national goal of reducing gasoline consumption and cutting greenhouse gas emissions.

“The scale of problem is so huge that we are focusing on solutions of the same scale,” Horton said. “There is a huge market today for [biofuel-powered] vehicles.”

California alone has nearly 500,000 cars that can take the ethanol blend; the nationwide number is about 9 million (see a list of car models), Horton said. California also has more than 500,000 of biodiesel cars on the road today. By 2012, half of the models made by American automakers would be able to do flex fuels, he said.

Propel’s investors include Craton Equity Partners, Nth Power and @Ventures.

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As of a year ago, Propel had 11 stations selling E85 (ethanol blended to 85 percent) and biodiesel, and the company also said it could eventually sell electric vehicle charging as well. Propel had five of those stations in the Sacramento, Calif. region, and the other six in its former hometown of Seattle. According to the station locator on Propel’s web site, the company still has 11 stations operating, so it doesn’t seem to have expanded much over the last year. This $20 million round — which includes a $12 million investment from Craton Equity Partners, Nth Power and @Ventures, along with $8 million in debt financing — will help the company add more stations.

Are California residents really clamoring for more alternative fueling stations where they can pump biofuels into their cars? I’m not sure, but the wind has been knocked out of the corn ethanol markets over the past couple of years (see Biofuel Death Watch Map) and customer interest in both E85 and flex fuel vehicles hasn’t seemed to ramp up very quickly. On the other hand several automakers are working on flex fuel models, and a federal working group recently recommended that governments should use more flex fuel vehicles (see this DOE map of density of alternative fueling stations).

Electric vehicles are garnering more attention from car companies and customers, so adding on EV charge points to Propel stations would be a good idea. But then that also puts Propel in competition with companies like Better Place and Coulomb.

Currently Propel has found a market selling its fuel to California state employees, and Propel CEO Rob Elam told me last year that Propel relocated its headquarters to Sacramento last year because the intersection of public policy, public funding and entrenched companies (in the oil and auto industries), is a good place to be for a clean car startup.

Don’t get me wrong, the idea of branding the alternative fueling experience is a very cool one. But I think the road will be difficult. When I first launched Earth2Tech back in 2007, one of the first stories I wrote was about a company called Conserv Fuel that was trying to do the same thing down in Southern California. Conserv’s dynamic CEO, Kristopher Moller, came from a family of traditional gas station owners and had succeeded in convincing then-presidential hopeful Barack Obama to make a speech at his first station (see video clip here).

Last time I talked with Moller the company and brand were really struggling (the web sites are now shut down). Country music celebrity Willie Nelson also tried to brand the biofuel experience with BioWillie biodiesel brand, and that company has had more than its fair share of problems (see The Sad Ballad of BioWillie Biodiesel, and BioWillie’ Chief’s Questionable Comeback). Moller told me last year that he was really frustrated over California regulations that added a lot of extra cost to biofuel pumping, and the just getting the word out with marketing was difficult. This is just not an easy market for a startup. Good luck Propel.

Since the launch of the agreement in 2005, some 500 more cities have signed on (and counting). And while some cities just signed the document and moved on, others have used the initiative to draft further innovative strategies that deliver meaningful reductions. The most effective strategies, by far, have been those that bring sustainability initiatives into the office of economic development and turn the city into an early adopter of “green” products and services. It’s exactly this sort of strategy that makes the following cities the best in the country to be a cleantech start-up. In a report, Living Cities Foundation interviewed sustainability directors and gathered data from city sustainability departments throughout the country. We’ve landed on the following seven as the best spots to start and grow a cleantech company (more interviews from the report here).

• San Jose
• Boston
• Austin
• San Francisco
• Seattle
• Portland
• Denver

First up: San Jose »

Image credit: arimoore.

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The first is from a Variety article recapping the view, espoused by TV industry types at Screen Digest’s PEVE Digital Entertainment Conference, that more viewers will move from broadcast and cable TV to ad-supported online video. But not everyone shares this doom-and-gloom about traditional TV. MediaPost, author of the second headline, recapped a panel at Online Media, Marketing and Advertising’s Global Hollywood Conference, “How Online Is Reshaping The TV Advertising Marketplace (and Vice Versa).” Speakers at this conference said they believe that traditional TV will continue to play a huge role in how we consume video, pointing to a recent Nielsen study that showed TV watching was at an all-time high.

So which is it? What does the future hold for traditional TV and online video?

Unfortunately, the data points in many directions at once. The Nielsen study referenced above also shows that more people are watching video on the Internet, as well. And in a recent survey of its users, NBC found that not only were more full episodes watched online at its site year over year, but users were also setting up computers in the living room and “co-viewing” online video with other people. Not to mention the impressive growth curve that premium content site Hulu is experiencing.

Perhaps looking to burst a few web video bubbles, though, the Telco 2.0 Initiative put out a press release on March 24 with the attention-grabbing headline, “Online video not commercially viable, new report says.”

Even though it predicts the market for online video (including both services like YouTube and IPTV) will reach $28 billion in 2013, Telco 2.0 says that forecast is less than 10 percent of revenue earned by traditional TV and movies. The research firm envisions three potential scenarios for online video. The entrenched players traditional video reassert themselves online (a la Comcast and Time Warner’s authentication plans); piracy destroys the value of copyrighted content; or telcos and Internet service providers (ISPs) move from their current passive role to one in which they become more like FedEx, offering different distribution tiers.

But this whole online video vs. TV debate is fast-becoming antiquated, as the lines between traditional TV and online video continue to blur. Just about every network TV show can now be watched online. YouTube and other web video can now be accessed through TiVo and other set-top boxes. And televisions are increasingly plugging directly into the Internet to access new forms of content and interactivity.

The industry is going through growing pains right now, and no one is sure where it will settle out. At the end of the day, the audience just wants to watch something that entertains; those who create entertaining content will want it on as many screens as possible, and those who own the entertaining content will make sure they get paid for it.

This article also appeared on BusinessWeek.com.

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Many major cities in the U.S. ban driving while talking, although most of those allow the use of headsets or other hands-free solutions.  Personally I think it’s the lack of concentration on driving due to the phone conversation as much as holding a handset, so I’m not sure that headsets make that much difference.  My own city of Houston has ordinances that ban the use of phones while driving in school zones which seems like a good thing.

New York City recently had a one-day clamp-down on driving while using a phone and issued over 9,000 citations to drivers talking on phones.  That number is amazing even for a large city like NYC, and it indicates the law is not impacting the practice enough.  Another statistic that I find amazing is that over 195,000 citations were issued in NYC in 2008. That plainly shows that the $120 fine is not a big deterrent to those who talk and drive. Maybe it’s time to force the use of gadgets that prevent phone calls in cars?  These are typically designed for teen drivers but they’re not the only ones doing all the texting or talking.

(via cellular-news)

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The new stations are located in Northern California in the Sacramento area and on Wednesday the company will host a kickoff event at one of them in Rocklin, Calif. (It starts 10AM for those interested in stopping by.) The Propel Clean Fuel Point-branded stations were largely in the Washington state area up until recently, and all of its stations currently sell E85 (ethanol blended to 85 percent) and biodiesel. Propel CEO Rob Elam says eventually they will charge electric and hydrogen vehicles, too.

While Elam wouldn’t disclose how much each station cost to build, he said Propel used some grant money from the California Air Resources Board (CARB). The stations can’t be that expensive as Propel has only raised a Series A round of $4.75 million from @Ventures and Nth Power, and the company owns and operates the stations itself, and also doesn’t plan on raising more money anytime soon, says Elam.

It’ll be interesting to see how many station customers are average biofuel-using Californians vs. employees of the state, which has agreed to purchase fuel from Propel. Elam called Sacramento the intersection of public policy, public funding and entrenched companies (in the oil and auto industries), which is a good place to be for a clean car startup. Particularly in 2009, Elam says, if a clean car company can’t navigate Sacramento, it will be at a serious disadvantage.

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