Israel has been at the forefront of algae research for years, and is now working towards creating bio-fuel from algae.

An ISRAEL21c series: The Israeli Energy Alternative

Consumers worldwide are watching with worry as fuel prices steadily climb with no end in sight. The US Department of Energy predicts that by 2025, residential energy consumption will increase by 25% and based upon current trends, the cost of that energy will concurrently rise dramatically.

As fossil fuel resources for petroleum used in fuel processing dwindle, global warming from burning those fossils heats up. Industry experts predict oil production’s peak out in 2007 and the race to find affordable alternative energy solutions sprints forward for scientists, environmentalists and politicians worldwide. Everyone is searching for the proverbial golden ticket: affordable, alternative energy sources to take us into the next century. Frontrunners in the alternative arena, Israel’s scientists are at the vanguard of finding innovative yet affordable fuel and energy options.

In the ongoing ISRAEL21c series ‘The Israeli Energy Alternative,’ we’ll profile some of the most promising projects and initiatives currently underway in Israel to address growing US and global energy changes.

Part 2 — Algae as a Fuel Source

Israeli scientists – well acquainted with the energy-producing capacity of algae – are applying that knowledge to fuel the future. Algatech in the southern Negev is turning a collective focus towards algae-derived bio-fuel.

Over 150 species of algae are currently used commercially to provide food for humans and livestock, serve as thickening agents in ice cream and shampoo, and ward off disease in pharmaceutical drug form. Unaltered, algae encompass different groups of living organisms that capture energy through photosynthesis, converting inorganic substances into simple sugars.

Founded in 1999 to develop and commercialize micro-algae-derived products for the nutraceutical and cosmeceutical industries, Algatech’s 25-strong production facility based in Kibbutz Ketura will soon begin collaborating with Israeli-US start-up GreenFuel Technologies Corporation to work towards a common goal: developing cost effective, energy efficient fuel made from micro-algae feeding off of carbon dioxide emissions.

“The bio-fuel concept is old,” Algatech Research and Development head Dr. Amir Drory, told ISRAEL21c. “It started in the 60s and 70s when people started to look for alternatives. The area caught our attention a long time ago but this was not our major activity or research direction.”

Headquartered in Cambridge, Massachusetts, GreenFuel is manned by a thirty-person workforce developing algae bio-reactor systems that convert carbon dioxide or smokestack emissions into clean, renewable bio-fuels. The company was founded by Isaac Berzin, an Israeli industrial bio-engineer principally responsible for patenting GreenFuel’s approach to efficiently propagating algae on an industrial scale.

Algatech and GreenFuel have been in discussion for at least a year, both sides recognizing that a partnership in which one side provides the algae while the other provides technology for turning it into fuel is a complimentary fit. So complementary, in fact, that in June the Israel-US Bi-National Industrial Research and Development Foundation (BIRD) issued the parties a collective co-research grant.

“This is a project where the technology has its own merit independent of the area,” BIRD Executive Director Eitan Yudilevich, PhD told ISRAEL21C. “The partnership is very interesting between a US startup and Israeli company. Many times it’s the opposite. When you look at a reason for giving a partnership grant you also look at synergy and theirs is great.”

BIRD’s board of governors issues grants twice annually to approximately twenty-five Israel-America collaborations and while individual funding details are confidential, overall policy allows for a maximum $1 million capital investment. Commercialization is an expected outcome and BIRD’s track record thus far has been successful. Former grantees currently traded on Wall Street include Scitex, Compugen, Elbit and Magic Software.

“From a technology point-of-view, there is no question that using algae to produce ethanol from CO2 is innovative,” Yudilevich explains. “These guys have been doing work for more than a couple of years and already have investors that believe in the product.”

The product, in this case, is a micro or single cell alga cultivated by Algatech using an optimization and screening process. Made up of lipids, starches and carbs — nature’s basic building blocks or the stuff we eat — algae goes from starch or sugar form through fermentation to alcohol and protein where it can be eaten or burned.

The major tasks facing Algatech and GreenFuel are culturing the algae, optimizing the process and keeping costs low as compared with conventional fuel or other bio-fuels already on the market.

“We’ll make it cost effective,” GreenFuel CEO Cary Bullock said. “In the past you couldn?t grow the algae fast enough to justify the cost of building the plant. But with growing improvements and weighing the costs of producing a refined fuel derived from putting a refinery next to a major carbon source, the benefit is dramatic. You knock out the costs of producing, importing, refining and shipping and you’re simultaneously reducing the amount of CO2 in the atmosphere.”

Bullock says there is a fair amount of power plant land in Australia, the US and Western Europe ideal for bio-diesel and ethanol production and notes that ethanol blended gasoline necessitates little to no engine modification. With government incentives such as tax credit subsidies, accelerated depreciation and credits offered to blenders on a per-gallon of ethanol blended fuel basis, it would seem the CO2 derived algae bio-fuel is already seamless.

“There’s a lot of work to be done,” Bullock cautions albeit optimistically. “It seems too easy because you intuit the process at a high level. But on a basic level, it’s very hard. You’re working with micro-organisms that not a huge body of research is available on.”

Which is part of the reason GreenFuel and Algatech teamed up. Israel has been at the forefront of algae research for years, cultivating, developing and studying different strains of microalgae under ideal climate conditions. Algae can be grown in a wide range of regions, including temperate zones such as Europe, but the Negev desert setting is ideal.

Scientists on both fronts are eager to begin active collaboration expected to extend two to three years and both Drory and Bullock estimate they’ll have product to market within the coming decade. Governments and industrialists in the U. and Europe are already watching.

Will shortage be a future factor with which to contend?

“There are about 30,000 species of micro-algae – mostly unexplored,” Drory summarizes. “The reserve of micro-algae is huge – it’s the same as fungi decades ago before they started looking into antibiotics. We won’t face a shortage. We just have to invest money and effort to find very interesting micro-algae to work with.”