Future bright as Arizona’s sun for making algae production an economic driver - Inside Tucson Business: Top Stories

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ALGAE-FUEL INDUSTRY BRIGHT Future bright as Arizona’s sun for making algae production an economic driver

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Posted: Friday, October 7, 2011 12:00 pm

In the future, Arizona may have to add an A to the five C's - copper, cotton, climate, citrus and cattle - that have been the state's economic drivers.

Algae thrives on sunshine, CO₂, and brackish water. Three things that Arizona has in abundance, making the state the perfect place for growing algae for food, feed and ultimately fuel.

This makes algae a potential boon for researchers at the University of Arizona and Arizona State University, both operating under the Sustainable Algae Biofuels Consortium.

The consortium, fueled by a $6 million grant from the U.S. Department of Energy, is testing the viability of algae as a replacement for petroleum-based fuels. Additionally, Gov. Jan Brewer a year ago issued $4 million in grants and matching funds to the industry.

Here, beneath the blazing sun at the University of Arizona's Campus Agriculture Center, 4101 N. Campbell Ave., Randy Ryan, assistant director of the Agriculture Experiment Station, and Peter Waller, associate professor with agricultural-biosystems engineering, are developing test-bed systems to solve two problems: temperature management and growth. Using both fresh and salt-water algae, the researchers hope to develop a system that allows for year-round growing in Arizona.

"(Temperature management) is important because in the desert the temperature fluctuates wildly from day to night and from winter to summer," said Waller.

Moving beyond the raceway system, Ryan and Waller have solved the temperature problem by changing the surface area, combining two meter canals with shallower basins. This allows them to manage to temperature by a few degrees despite sweltering summer conditions or winter freezes.

By managing the algae species, they can also make sure to keep the algae in production throughout the day, making their system more efficient and thus minimizing costs. Ultimately, they hope to develop algal biofuels for the equivalent of $60 per barrel.

Their biggest challenge is the lack of salt-water, so here they make their own salt-water by adding chemicals. This effort replicates bad-water conditions around Arizona, taking an agricultural problem and turning it into a benefit. They also use liquid CO₂. According to Ryan, a farmer could potentially set-up a system in three weeks, growing the algae-like a crop and then shipping a concentrate to an extraction site, where the algae can be turned into fuel.

This vision includes a sustainable CO₂ cycle, making the operation nearly carbon neutral.

"Algae can be a significant industry from the Gila River to Yuma, using brackish water to feed it," said Ben Cloud, CEO of Phyco BioSciences in Chandler. He estimates the industry could pump as much as $2 billion into the state's economy, while using water from non-potable sources, including agricultural runoff and treated wastewater.

Phyco BioSciences, part of Phoenix-based XL Renewables Inc., was created from an effort to develop an integrated biorefinery in western Arizona, using algae to create feed from the waste stream. Starting in 2004, the company used its experience in designing the biorefinery to develop what it calls the "Super Trough System." The system includes a V-shaped liner fitted with emitters for aeration and nutrients.

This liner can be laid down from the back of a truck into pre-dug ditches creating what the company terms a "farmer-friendly" approach to algaculture. Algae farming can be based on the common 40-acre field and the technology can be deployed using common agriculture equipment.

According to Cloud, using proven agriculture methods rather than construction methods lowers the costs dramatically.

Additionally, algae farms can be co-located next to diary farms or coal-fired power-plants.

"The way we do that solves an environmental problem," said Cloud. The design would be set next to a diary farm, taking effluent into anaerobic digester which breaks it down. The material is then burned, the resulting CO₂ is used to feed the algae, while waste-heat can be used to keep the algae warm when needed.

A similar design with a coal-plant could use the CO₂ to feed the algae, but because of the heavy metals in coal, this algae likely won't be used for food. However, a coal-fired power-plant can produce 5 million tons of CO₂ per year, far more than the algal industry could ever use.

In the right scenario, an algae farm could use waste products to replace fossil fuels.

Fossil fuels, essentially the petrified remains of dinosaurs and ancient plants transformed by eons of heat and pressure, are ultimately limited. However, algae represents a new kind of energy product, one that can be treated as a crop and because of algae's exponential growth, can be harvested daily or weekly.

"If you look at a typical terrestrial crop such as corn or soybean you're probably talking about a 100- to 120-day growth cycle, so typically you get one crop a year. The benefit with algae is it can be harvested every week," Cloud said.

Ryan concurs, noting that because of algae's exponential growth, algae could potentially be harvested daily.

Cloud estimates that Arizona commercial production in 2012 could be 1,000 to 1,500 tons and that the potential exists for 50,000 tons by 2021. Phyco BioSciences is currently producing algae for between $1,000 to $1,500 per ton, but if the company can lower costs, a potentially huge market for fuel becomes achievable, especially at production as high as 100,000 tons.

Varying the species of algae gets different results, one kind of algae can be "cracked" for the oil inside, but another algae can be better for producing food stocks and another can produce feedstock. This flexibility makes algae a powerful crop, according to Cloud.

Unlike corn-based ethanol or soy-based biodiesel, algae can be grown on less acreage while providing a near 100-fold advantage in yields. And, since ethanol production makes lots of CO₂, algae can tap into that as well.

Both Phyco BioSciences and the UA projects are designed with the ability to make multiple products. Phyco BioSciences is focusing on algae as a food, especially the development of "superfoods."

"Algae is emerging as a new food industry product," said Cloud. Algae can produce a high-value, high-nutrition product that is valuable because of its high doses of Omega-3, an essential fatty-acid that may treat several common health problems.

Phyco BioSciences is also developing feed for aquaculture, adding algae to fish-meal improves the nutritional benefits of farm-raised fish.

"Algae can solve this problem," said Cloud. "Algae will have a significant impact on our society because of its nutritional benefits."

Development of algae for aquaculture led to an agreement last year with China Biological Engineering Limited, Hong Kong, which together with Phyco BioSciences is building two projects in eastern China. BioSciences is the single-source for components and China Biological Engineering gets 15 percent equity interest.

Phyco BioSciences will continue to develop the technology, pushing the envelope so algae will be a future crop.

"Algae has a bright future in Arizona," said Cloud.

"We have to find some better way of making energy," said Leanne Strauss, an undergraduate senior in chemical engineering at the UA. "This is the first raceway track of its kind and its pretty cheap way to build."

Development of algae systems could create a new crop industry for Tucson, one that endures under the summer sun and solves a few environmental problems along the way.