15 Algae Fuel Startups, 2010 Edition


Two and a half years ago we put together this cheat sheet on 15 algae fuel startups you need to know, which turned into one of our most popular posts of all time. But boy have things changed since then. In early 2008 GreenFuel Technologies was still in business, Aurora Algae (then called Aurora Biofuels) was still focusing on fuel, Petro Algae hadn’t yet filed for an S-1, and it was unclear then that Craig Venter’s Synthetic Genomics was going to become a dark horse in the algae fuel world. Here’s our updated 2010 version of our original 15 algae fuel startups bringing pond scum to fuel tanks:

1). Solazyme: One of the leaders in the algae fuel industry, seven-year-old Solazyme has amassed more than $125 million in funding from high profile investors like oil company Chevron’s VC arm, investors Morgan Stanley, Virgin Group’s Richard Branson, and personal goods product producer Unilever. I toured the factory last year, and while the company isn’t producing commercial-scale algae fuel just yet, it’s currently selling its algae oil for applications like food (yum, algae milk) and products like lotions. Solazyme wants to commercialize its fuel technology in the 2012-2013 time frame, with a production cost target of $60 to $80 per barrel. To get there, it will have to build a commercial-scale algae plant, which can cost over $100 million.

2). Aurora Algae: Formerly called Aurora Biofuels, the newly christened Aurora Algae has been searching for commercial markets today in turning algae into nutrients and protein products, in contrast to the far out markets for algae fuel. That change is not exactly a vote of confidence for the short-term plans of algae-based biofuel startups to bring a cost-competitive replacement for fossil fuels to market. Originally developed at the University of California at Berkeley, the company is using genetics to isolate algae strains that can efficiently create biodiesel. Aurora claims the technology can create biodiesel fuel with yields that are 125 times higher and have 50 percent lower costs than current production methods

3). Synthetic Genomics: Synthetic Genomics — the brainchild of genomics guru Craig Venter — has scored the largest deal with an oil company of all of its competitors: a $600 million partnership with Exxon Mobil. As we put it last year, the deal was so big for the nascent algae fuel industry, it was basically algae’s big break. Synthetics Genomics and Exxon opened an algae test facility at Synthetic Genomic’s HQ in La Jolla, Calif. in June. The greenhouse facility is the first step in figuring out if Synthetic Genomic’s algae fuel can move beyond the lab environment and be produced economically at a larger scale. The next step will be an outdoor facility that the partners will build by 2011.

Synthetic Genomics also had a world-changing breakthrough in May, when Venter officially became God and his team successfully created the first synthetic bacterial cell — in other words, the first artificial life form. A synthetic life form could be uniquely suited to help fight climate change and aid in uncovering new energy sources because a designer organism could be developed to only perform certain tasks, like converting sugar to ethanol, which would result in a very efficient process. Natural microbes have other life priorities like, say, replication, but a synthetic organism can be created to perform one function only.

4). PetroAlgae: PetroAlgae currently trades on the trades on the OTC Bulletin Board under the symbol PALG, but in August filed an S-1 for an IPO. PetroAlgae describes its technology as a development of light and environmental management systems that enable algae to grow at four times its natural growth rates. The company says its “secret sauce” is in its software, which can manage algae harvesting density and sunlight exposure, as well as its remote sensing system that can measure the algae crop density.

However, the company’s business model (conveniently for them) is to have their customers pay “all upfront infrastructure costs as well as continued maintenance for their licensed facilities,” in addition to licensing fees for the first three years of a 20-year license, plus a royalty stream during the life of the license. I’m pretty skeptical of this company — it’s steadily lost money and has no revenues.

5). Sapphire Energy: Sapphire is another algae fuel heavyweight that hadn’t yet come onto our radar at the time of our original list. Founded in 2007, Sapphire Energy plans to ramp up its production to 1 million gallons of algae-based diesel and jet fuel per year by 2011. By 2018, Sapphire says it will crank out up to 100 million gallons per year, and by 2025, the company says that number will soar to 1 billion gallons per year, which would be about 3 percent of the U.S. renewable fuel standard. So yep, those are some big claims. Sapphire has raised more than $100 million from the likes of Bill Gates’ investment firm Cascade Investment, as well as ARCH Venture Partners, Wellcome Trust and Venrock, and so far it has tested its fuel with two commercial airlines: Continental and JAL.

6). Bioalgene: Outta Seattle University, Bioalgene is trying to speed up the process of algae production to an 8-day cycle. The company says three outdoor field tests in 2008 with Washington State University have proven its concepts, and Bioalgene plans to build pilot plant sites in Eastern Washington.

7). Phycal: Phycal came onto my radar when it won a $24.2 million federal research grant for its algae fuel technology. It’s parent company is Logos Energy, and its based in St. Louis Highland Heights, OH.

8). Live Fuels: Live Fuels has a slightly offbeat new approach to algae fuel, that it’s tweaked since our original list. “We cook ‘em and squeeze ‘em,” LiveFuel’s CEO Lissa Morgenthaler-Jones explained to us, describing her company’s process for turning algae-fed fish into oil for fuel using heat and high pressure. It’s a more gruesome way of harvesting pond scum than the mechanical equipment employed by other startups working on algal fuels. Founded in 2006, LiveFuels kicked off its pilot operations at a 45-acre open pond test facility in Brownsville, Texas, a year ago. The company raised $10 million in May 2007 from David Gelbaum’s quiet Quercus Trust.

9). Solix Biofuels: Solix says its technology is able to be massively scaled, which at the end of the day is the secret that will unlock algae fuel. Specifically Solix describes its technology as proprietary photobioreactors that are ten times more productive than open pond systems. Partners include Valero, Los Alamos National Labs, Colorado State University, and Shanghai Alliance Investment.

10). Aquaflow: The New Zealand company’s goal is to become “the first company in the world to economically produce biofuel from wild algae harvested from open-air environments.” The company is unusual in that it harvests algae from polluted waters and produces biofuels from that harvested algae. So revenue streams can be cleaning up water, and producing biofuels. The company has partnered with Honeywell’s (s HON) UOP.

11). Bionavitas: Four-year-old Bionavitas is still pretty much under the radar, but according to some reports (like this CNET one) the company uses long light rods to deliver more light to algae to stimulate growth and to cut the costs of algae farming.

12). Seambiotic: Seambiotic says it’s “the first company in the world that is utilizing flue gas from coal burning power stations for algae cultivation.” The company is seven-years-old and is based in Israel.

13). Bodega Algae: Like several of its competitors Bodega Algae uses closed bioreactors instead of open ponds to grow algae. But the company’s reactors are scalable and stackable, and are meant to be placed next to industrial and municipal waste streams to harvest the algae. Bodega has its roots out of MIT.

14). Algenol: Algenol says it grows hybrid algae to produce ethanol, and has assembled one of the largest collections of blue-green algae strains in the world. To date, the company says it has raised $70 million and it plans to build a pilot-scale biorefinery, and a 100 million to 1 billion gallon of ethanol per year refinery. Algenol says it has partned with Dow Chemical and Valero and has received a $25 million grant from the DOE.

15). General Atomics: OK, it’s not a startup, but San Diego-based nuclear power research company General Atomics has been working on algae fuel technology for the past couple of years and last year scored a $43 million contract with DARPA to create algae-based jet fuel.

For more research on cleantech financing check out GigaOM Pro (subscription required):



Yet again more research on algae biofuels production. This has to do with the closed loop systems using clear piping, well, I have found that the piping is one of the most expensive parts of the system. This compelled me into researching this problem. what I found is white rigid sch. 40 PVC piping is fairly inexpensive 3”X10’ pipe is about $6.00, where as a 3”X10’ piece of rigid clear sch. 40 PVC pipe is about $150.00.
I am wondering why that is!? Can someone tell me? It is the same process to make either forms of PVC piping “extrusion”. As a matter of fact the white piping has added chemicals such as pigments, and other chemicals which make it UV stable.

b cole

To learn about the fast-track commercialization of the algae production industry you may want to check out the National Algae Association, the trade association. The NAA engineering and research consortium have designed the first 100 acre algae production plant with all the CAPEX and OPEX.

The NAA has established benchmarking guidelines to help cut down on all the production level noise.


Here is a little bit of a conspiracy theory on algae as a bio-fuel. Supposing the people that are doing all this research, and reporting to the public, and government are lying and they can produce algae fuels very cheaply? I mean just for conversation sake, say $0.02 a gallon. First of all they get grants from the government to do “research“. Then when that money runs out they tell the people that it costs say $2.50, a gallon to manufacture, or some amount to make it competitive with the oil companies , I mean how hard would it be to waist energy, time and money on a project to make it look like it costs more than it really does? How would you know?
The reason I even thought about this at all is because, the companies doing the research don’t disclose this information, they are vague on their processes, how much energy they use, and so on. One company says they can produce between 20,000-100,000 gallons of algae oil per acre per year. I mean come on, this company has been doing this research for several years and that is there closest estimate they can come up with? Anywhere between 20,000-100,000 gallons per acre per year? That would be like me selling you a car, that I have owned for a few years and saying it gets between 5 and 40 mpg not real sure which though.
It seems to me if you look at it from an economic standpoint if you could produce the higher end amount per year on one acre, you would easily flood the market… Holding back would make financial sense. This may not be true, but with the wild “costs” per gallon they are saying… it sounds fishy to me.


I have been doing countless hours of research on the subject because it interest me. I would like to give my opinion on the cost of producing fuel from algae, (this is not to include the price of the facility). From what I have read, there is a company that claims they can produce up to 100,000 gallons of bio-diesel fuel per acre per year, through a closed loop vertical system (the way it was explained it increases the surface area exposed to sun light est.). Assuming that statement is true, then I really don’t see the cost being so high.
The way I see it, it’s like this, first of all you grow the algae, then the oil is extracted by whatever means. What you have then is unprocessed algae oil, and a dry substance which, I believe is cellulose and starches. At this point you refine the oil into bio-diesel and glycerin . The glycerin being a by product, from what I have read, has about 1700 uses, and could be sold. Now you have two useful products, bio-diesel, and glycerin.
At this point I would like to get back to the by product of the dried oil extracted algae. Lets start with the starches, they could be fermented to produce alcohol, that could be used for a gasoline replacement then again another useful product. So what’s left over cellulose this could be burned for heat to be used in the processing of bio-fuel, it could be used to create methanol (destructive distillation of cellulose) and/or could be used in the transesertification process to create the bio-diesel. The ashes from the burnt algae could be used to produce lye (sodium hydroxide) also used in the bio-diesel process, also this product could also be used to sequester carbon dioxide (lithium hydroxide, carbon dioxide scrubber).
With all this being said it seems to me that you wouldn’t have the need to use any external power, because a percentage of the fuel being produced could be used to power you plant operations via a generator. Again from what I have read a 20kw diesel generator @ full load uses about 1.6 gallons of fuel per hour that equates to 14,000 gallons a year. From what I have seen what they were saying about the pumps est.… the power usage for a one acre, and this is a (high conservative) guess would be between 5000-10,000 watts. I just seems to me that everyone only focuses on one product for the algae.



Very nice article. I see one of the comments mentioned Joule and you replied that they said their engineered organism was not algae. In this recent article regarding their patent, their engineered organism is called cynobateria, or blue-green algae. I’m not sure if it is significantly engineered so as not to call it algae or not, but it does seem like some sort of algae.

Thanks again for the great article! Here’s that link:



Which of these algae based biofuel producers use gasification technology integrated with Fischer-Tropsch technology ?

Secondly, do “AltAir” and “Sustainable Oils” rely on gasification technology integrated with Fischer-Tropsch technology to produce bio jet fuel ?

Would really appreciate some valuable feedback as I’m working on a research project


Amazing – all that money and nobody is up to commercial scale yet. There are plenty of labs that are outfitted with the latest, greatest equipment and there are millions of patents that are and will remain useless until commercial-scale algae production is under way. And after several hundred millions in money spent by the DOE on research, the military just paid Solazyme what amounts to $425/gallon for a few thousand gallons – after delivery, it turns out that those contracts, like the DOE agreements and funding opportunities, are for research and development. So long as there’s money that can be given out with no strings attached (ever hear of a DOE grant recipient having to return funds?), the research will go on.

Durwood M. Dugger

Katie – As a company with with decades of commercial algae production experience (not for fuels), BioCepts International Inc. (BCI) hasn’t seen anything in our 4+ years of study that makes algae oil look economically or strategically feasible as a major global energy source contributor. Or, as a company well versed in algae production technology – we would be on it like green on goo, slick on slime, or like cute on all those algae oil PR metaphors.

We do see future uses of algae in very site specific application opportunities where it could be used to recapture waste nutrients in some CAFOs, aquaculture, food processing, sewage and in the remediation of polluted resources. Generally, feasibility for algae in even this limited role is limited by spatial resources, the quality of the waste nutrients, climate, and the resulting economics. In most of these cases where algae is economically feasible it will be a secondary or ancillary production component, require little or no increased nutrient input. It will generally only offset some of the energy or nutrient cost requirements of the primary products in the process of reducing or eliminating the primary products waste stream treatment costs. The economic feasibility is again – very site and condition specific, so it certainly isn’t a silver bullet for either global energy or environmental solutions. However, using algae should certainly be a component in the modern world’s future food production, human habitation and waste treatment logistics planning and strategies – even if it can’t be a significant and economically efficient energy source.

Katie Fehrenbacher

@Durwood M. Dugger, Thanks for the comment, and I agree would love to have all those costs lined up for these companies. Most of them don’t disclose current prices, probably because they are so high right now!

Durwood M. Dugger

Your article would be so much more impressive – and useful – if you would have included the current levels of algae oil production costs of each of these various companies. After all their PRs are available online. For example, I read that the Solarzyme contract with the Navy for a few thousand gallons of algae oil for its jet fighter tests was for $800/gallon – not exactly impressive or competitive with anything. The least expensive audited and documented production costs we have seen for algae oil was about $18/gal. Of course the key phrase in that last sentence is “documented.” There are lots of claims by these companies, but little or no economic documentation. Economic production data doesn’t expose proprietary technology so there is no reason not publish them – if you have something competitive. Scale-up is the common excuse for extremely high algae oil costs. However, if you lack even remote proximity to competitive production costs for algae oil, it’s not a surprise that no one will fund a commercial scale-up.

Regarding the economics, in those few instances where a company publishes its production costs, you will find them wanting to compare algae oil to crude oil market prices rather than crude oil production costs. To be a competitive entity in the fuel market place and compete with petroleum (especially those as arbitrarily set by OPEC) you must compete at or near petroleum production costs if you don’t want big oil interests to put you out of business as happened to alternative energy efforts in the 70s.

Finally there are the two non-sustainability issues which algae oil and other bio-fuel producers aren’t discussing: 1. Their dependence on chemical fertilizers (petroleum based) the same as 85-95% human food production. Current estimates of the availability of logistically feasible, waste based nutrients for algae oil production predicts that waste based algae oil production could supply less than 3% of our energy needs. 2. Their dependence on agricultural phosphates which are estimated to peak in 30 years or less, be essentially gone in perhaps 50 years and which are essential to all modern human food production. Anyone who thinks you can produce any kind of plant biomass intensively and consistently (at the scales necessary to significantly impact global energy needs) without these essential nutrients is to put it nicely – technically naive.

The dependence on finite natural resources such as petroleum and phosphates makes algae oil and other bio-fuels at best an emergency bridge technology until we can convert our energy needs to solar, wind, wave and tide – which are not dependent on the earth’s limited natural resources. All of which begs the question as to why we would want to spend billions of dollars developing bio-fuels rather than focusing on energy sources that aren’t going to compete with food production and that whose essential production ingredients aren’t going to run out in the next 50 or 100 years?


If actually growing algae is a criteria to be on this list then you should remove PetroAlgae. They now grow something called Duckweed. Their product is no longer fuel, either. It is protein and dried biomass that they call “biocrude.” The business strategy has moved a long way from their name.

Katie Fehrenbacher

@Krassen, Joule’s CEO specifically told me last year in an interview that their highly engineered synthetic organism was not algae. Maybe that plan/marketing has changed, but that’s the last I heard.


Major University Admits Hard Science
Problems Relating to Algae Have Been Solved

Arizona State University Senior Vice President Rick Shangraw recenty said “…algae will “deliver soon” because…most of the hard science problems science problems regarding algae have been solved…Now…it’s largely an engineering problem.”

The real question is: Does the DOE really want the US to get off of foreign oil or do they want to continue giving grants to algae researchers to keep them employed at universities for another 50 years?

Krassen Dimitrov

Joule Biotech is definitely there in terms of making noise and big claims.


“currently selling its algae oil for applications like food (yum, algae milk)” – a chuckle; but, realize most people around the world consume algae products in a great many everyday foods – and have been doing so for decades.

Another market that was always there for algae growers. Look at the label. See agar or carrageenan? Also in shampoos, tooth paste, diet sodas, pet food and soy milk.

Comments are closed.