SERVTP-231-2608 

UC Category: 61c 

DE85002926 

Technical and Economic 

Analysis of Liquid Fuel 

Production from Microalgae 

Daniel A. Feinberg 

December 1984 

Prepared for 

Energy from Biomass and Wastes IX 

Lake Buena Vista, Florida 

28 January - 1 February 1985 

Prepared under Task No. 4625.20 

FTP No. 388 

Solar Energy Research Institute 

A Division of Midwest Research Institute 

161 7 Cole Boulevard 

Golden, Colorado 80401 

Prepared for the 

US. Department of Energy 

Contract No. DE-AC02-83CH 10093 
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TECHNICAL AND ECONOMIC ANALYSIS OF' 

LIQUID FUEL PRODUCTION FROM MICROALGAE 

Daniel A. Feinberg 

Staff Process Engineer 

Solar Energy Research Institute 

Golden, Colorado 8040 1 

ABSTRACT 

Under the sponsorship of the US. Department of Energy (DOE), the Solar 

Energy Research Institute (SERI) has conducted a technical and economic evaluation of the production of fuels from a microalgal feedstock. This effort was 

divided into two areas: feedstock production and subsequent conversion of the 

feedstock into fuels. An Algal Production and Economic Model (APEM) was developed to estimate capital and operating costs for mass culture facilities. This 

model estimates that if today's technology were applied on a large scale (e.g., 

20-ha modules in a facility of 1000 ha), a microalgal feedstock suitable for conversion to fuels could be produced at a cost of $436/t (1984 dollars). Sensitivity 

analysis demonstrates that the production cost could be reduced to $224/t by a 

series of improvements such as increased salinity tolerance, increased photosynthetic efficiency, increased lipid content, and decreased losses from water evaporation and C02 outgassing. Based on these microalgal production cost estimates, 

integrated refinery options for conversion of the microalgae to high-energy liquid 

fuels are evaluated. This portion of the analysis is based on preliminary data for 

processes that were developed for feedstocks similar but not identical to microalgae. Of the three major algal components (lipid, protein, and carbohydrate), the 

lipid component was determined to have the greatest potential as a source of fuels 

to replace conventional hydrocarbons. Two processes were examined-one based 

on the conversion of triglycerides into methyl fatty esters, which are being extensively investigated as potential diesel fuel substitutes, and a catalytic reduction 

process for the production of hydrocarbons, primarily in the gasoline range. The 

estimated costs of these fuel products compare favorably with the projected costs 

of conventional fuels at the turn of the century, as long as the presumed improvements in Lipid yields are achieved. 
TECHNICAL AND ECONOMIC ANALYSIS OF 

LIQUID FUEIS PRODUCTION FROM MICROALGAE 

INTRODUCTION 

Microalgae offer significant opportunities as sources of renewable highenergy liquid fuels. Among the qualities that make microalgae a unique feedstock 

for energy production are high b'om ss produc iviti s. The current limits of commercial technology ye f5 g m-i d-' (60 t ha-' yT') (peneman, et ale 19841, but 

yields up to 46 g m- d' (annualized to 110 t ha- yr- ) have been sustained over 

a one-month period (Laws 1984). Considering the infancy of this technology, the 

probability exists that still higher yields could be achieved. Microalga6 also have 

the unique ability to accumulate large quantities of storage lipids. A lipid content 

over 60% of ash-free dry weight (AFDW) has been found in some species 

(Tornabene et al. 1984). Also, many microalgae strains survive and grow well in 

waters of moderate to high salinity, which usually have low or even negative economic value compared with fresh water. This paper presents the results of a 

technical and economic evaluation of two potentially promising fuel production 

options from microalgae. The evaluation is based on the results of an economic 

analysis of intensive mass culture production of a microalgal feedstock suitable 

for conversion to fuel products. Preliminary data on conversion processes are 

used to determine the comparative potential of the fuel options. 

FEEMOCK CHARACTERISTICS AND COSTS 

Chemical Composition of Microalgae 

Microalgae are composed of proteins, carbohydrates, and lipids, with 

smaller amounts of ash and metabolic intermediates. The amounts and types of 

these components vary widely depending on species, environmental factors (e.g., 

temperature, illumination, nutrient levels), and method of culture (Tornabene et 

al. 1984; Tornabene 1984; Ben-Amotz 1984). Of the various algal components, 

lipids have by far the highest specific energy (energy per unit of mass): about 

39 MJ/kg (17,000 Btu/lb), compared to 24 MJjkg (10,500 Btu/lb) for protein, the 

next highest energy component. Lipids are chemically similar to hydrocarbons, 

especially aliphatics, which have long carbon chains but no rings. Lipids also 

resemble hydrocarbons in their low oxygen content, which is 15% or less, cornpared with 50% oxygen in carbohydrates. Because of their high energy content as 

well as their chemical resemblance to hydrocarbons, lipids from microalgae are an 

important potential source of substitutes for hydrocarbon fuels. 

Algal lipids are recovered sequentially by extraction with the solvents 

hexane, benzene, chloroform, acetone, and methanol (Figure 1). The chloroform, 

methanol, and benzene fractions are the most relevant to this examination of fuel 

product alternatives, sa they will be discussed first. The algal triglycerides and 

fatty acids identified to date (found in the chloroform fraction) are generally 

longer in average chain length and higher In degree of unsaturation than the oils of 

conventional agricultural crops such as corn and sunflower (Tornabene et al. 1984; 

Hill and Feinberg 1984). The tendency for polyunsaturated compounds to polymerize into waxy solids could create a problem with long-term storage of 

triglyceride-derived fuels. Further investigation of the triglyceride components 

will determine the degree to which polyunsaturation is a limitation on their 

suitability as fuel substitutes. Phospholipids (methanol fraction), although 

primarily present in the cell membrane, might also be of interest because of their 

fatty acid chains. Components of the benzene fraction have been less well 

characterized than the triglycerides, but it is known that olefins and aromatics 
Major components Range of 

Solvent of extract Typical content 

Hexane Paraffins 10% 

Benzene Olefins 10-50% 

Aromatics 

lsoprenoids 

Chloroform Mono-, di-, triglycerides 535% 

Fatty acids 

Acetone Glycolipids 10-50% 

Methanol Phospholipids 5-40% 

Figure I. Major Lipid Fractions as Recovered via Sequential Solvent Extraction 

are present, as well as isoprenoids (compounds which contain multiple units of 

isoprene: 2-methyl-l,3-butadiene). With regard to the remaining lipid fractions, 

the glycolipid fraction is generally ysociated with the membrane and is extremely 

variable in composition. Although the hexane fraction contains straight-chain 

hydrocarbons of 17-34 carbons, it is rarely present in quantities that are useful as 

a refinery feedstqck. AFthough further characterization work will be required on 

all algal lipids, sufficient preJiminary information is available to evaluate the 

feasibility of fuel production options. However, the production of a suitable 

microaIgae feedstock must first be examined; then the cost of the algae 

feedstock, added to the fuel processing cost, will determine the final cost of the . 

rnicroalgae-der ived fuel products . 

J3ccmomics of MicmaIgal Production 

The design and operation of a mass algal culture facility depends on many 

resource-, biology-, and f aciIity design-rela ted parameters. Important resourcerelated parameters are the salt and water balance (e.g., evaporation rate), source 

water characteristics such as salinity and nutrient levels, and land characteristics 

such as soil permeability, and surface contours. Biological parameters include the 

algal chemical composition, salinity tolerance .of the cultured alga, and photosynthetic efficiency, Facility design-related parameters include nutrient addition 

rates, outgassing losses (from carbon dioxide and ammonia), culture pond geometry (length/width ratio), and type of harvesting equipment, A computer model 

has been developed at SERI that uses these and other parameters as input and calculates capital and operating costs for the resulting algal production facility (Hill 

1984). This Algal Production and Economic Model (APEM) was used as a tool to 

evaluate sensitivities of algal production cost to the most critical parameters and 

to identify critical research issues. 
The analysis of the economics of microalgae production begins with the 

establishment of a base or reference case. The reference case is a consistent set 

of input parameters that represent a consensus of SERI researchers and other 

experts on what values might be expected if mass culture technology were irnplemented today in the southwestern United States. Based on current knowledge of 

mass culture facilities, the reference case is a point of departure for further 

evaluation of cost improvements that could be achieved through continued 

research and technical progress. All cost figures are reported in 1984 dollars. 

Briefly, the mass culture facility is sized at 1000 hectares (ha) (2500 acres), about 

85% of which is occupied by the culture ponds; the remainder is required for support facilities such as harvesting systems, buildings, laboratories, access roads, 

and piping. There are forty-three 20-ha single modules, or ponds. Each module is 

a meandering channel 300 m long by 30 m wide, with a culture depth of 0.2 m. 

Mixing is accomplished by paddlewheels located at the end of each channel. The 

reference-case harvesting system consists of two stages: a microstrainer followed 

by a centrifuge, which together increase the product solids concentration from its 

initial value of 0.05% (500 mg/L) to 10%. 

Carbon, the major nutrient, is supplied in the form of gaseous carbon 

dioxide, which is obtained from power plant flue gas. The C02 is scrubbed, compressed, and transported by pipeline to the algal culture facility. The model 

determines the quantity of carbon dioxide required to support the specified productivity level and then, based on transport distance, calculates the delivered CO 

cost. In the referen e case, wi h a transport distance of 80 km, the calculate3 3 6 C02 cost is $0.14/m ($4.00/10 SCF). The biomass productivity is calculated 

from the depth, culture density, and detention time (total culture volume divided 

by flow rate). With a culture density of 500 mg/L and a d tention time of 4 days, 

the reference system has a productivity of 25 g m-' d-'. The reference-case 

photosynthetic efficiency (based on the photosynthetically active radiation [PAR]) 

is 7%. The algal composition is 30% lipid, 20% carbohydrate, 32% protein, 10% 

metabolic intermedi'ate, and 8% ash; the resulting gross energy content, calculated from the specific energies of each compone t, is 24.9GJ/t 4' (10,730 Btu/lb). The cost of the source water is $0.067/m . The reference 

parameters used in the APEM are listed in Table 1. 

The total production cost was estimated to be $436/t of algae. The breakdown of the total cost into capital costs (both depreciable and nondepreciable) and 

operating costs is shown in Table 2. Two important points are identified from the 

table. First, capital costs represent only 16.4% of the total product cost; reducing 

the capital cost is therefore less critical than reducing the operating costs. The 

depreciable portion of capital investment, the culture system and the harvester 

system, accounts for 75% of the total capital cost. Second, nutrients account for 

over half of the operating costs; they are the only raw materials supplied to the 

system besides saline water and free solar energy. In fact, of the total nutrient 

costs, carbon dioxide represents 80.5%, or 38.2% of the total product cost, which 

makes clear the need to maintain stable C02 costs. 

Based on detailed sensitivity analysis of the various input parameters which 

the APEM uses to determine the total algal production cost, the two parameters 

with the most potential for cost reduction were found to be rpicroalgal productivity and chemical composition. The combined effects of these two variables 

were analyzed by varying photosynthetic efficiency and lipid content. Photosynthetic efficiency was increased from the reference value of 7% to 12% to 18%. 

The 12% value represents what has been achieved in short-term studies (Laws 

1984), while 18% represents a value toward which research could be targeted. 

Theoretically, the maximum achievable photosynthetic efficiency, based on PAR, 

is in the range of 23%-29%, depending on the photosynthetic products produced 

(Bassham 1980). Based on the biochemical composition of Platymonas sp. (Laws 
Table 1. Reference Parameter Values for Microalgae Systems (1 984 $) 

RESOURCE PARAMETERS 

Evaporation 

Salinity of source water 

Nitrogen in source water 

Phosphorus in source water 

Potassium in source water 

Carbon in source water 

Land cost 

Energy cost 

Water cost 

Ammonia cost 

Super phosphate cost 

Potassium muriate cost 

Distance to C02 source 

COZ cost 

BIOLOGY PARAMETERS 

Salinity tolerance 

Phosphorus cell content 

Growing season 

Photosynthetic efficiency 

on PAR 

0.0035 m/d 

8 g TDS/L 

13 g/m3 

0.5 g/m3 

46 g/m3 

IOD g/m3 

$1245/ha 

$O.OS/kWh 

$0.067/m3 

$203/t 

$28 r .sit 

$102/t 

80 krn 

$0.i4/rn3 

35 g TDS/L 

0.007 g/g dry wt 

320 days 

FACILITY DESIGN PARAMETERS 

Effective culture area 86% of total size 

Effective culture downtime 10% of total size 

Module size 20 ha 

Channel width 30 m 

Depth of culture 0.2 m 

Carbon in medium 12 g/m3 

Nitrogen in medium 1.4 g/rn3 

Phosphorus in medium 3.1 g/m3 

Potassium in medium 5 g/m3 

Carbon losses , 0.5 g 6l 

Nitrogen losses 0.5 g m-2 d-I 

Mixing velocity 0.2 m/s 

Mixing system efficiency 65% 

Harvester solids removal 90% 

1984) and Phaeodactylum tricornutum (Terry et al. 1984), lipid content was varied 

between 20% and 60% of total biomass. Protein and carbohydrate contents were 

adjusted accordingly, with the protein content being fixed at an estimated 

minimum level (13%) required to support normal cell function. Proximate compositions for the various cases (low-li pid, reference, and high-lipid) are shown in 

Table 3, along with the calculated gross energy content for each case. 

Based on- the APEM output for each combination of photosynthetic efficiency and lipid content, Table 4 presents biomass productivity (the total dry 

weight of microalgae produced at the culture facility) and the algal production 

cost (expressed both in $/t and $/GJ) for these cases. Remember that the reference case has a total production cost of $436/t; dividing this cost by the 

energy content of 24.9 GJ/t gives a production cost of $17.51/GJ ($18.50/10 sp"" Btu) 

of algal energy produced. The biomass productivity for the reference case is 

62,000 t/yr. Table 4 shows that production costs can be reduced and productivity 

increased by increasirig photosynthetic efficiency at constant lipid content. Productivity can also be increased by decreasing lipid content at constant photosynthetic efficiency. Since constant photosynthetic efficiency implies constant net 

energy production, higher lipid content is associated with lower biomass productivity (because of higher gross energy content) and vice versa. However, 

increasing lipid content also serves to decrease the energy-based production costs 

per unit; the high-lipid cases have at least 13% lower production costs (in $/GJ) 

than the other two cases. The case with 18% photosynthetic efficiency and 60% 

lipid has neither the highest productivity nor the lowest production cost per ton 

but does have the lowest cost per GJ ($8.74/GJ or $9.20/106 Btu) and therefore is 

the most promising case from the fuel production standpoint. 
Table 2. Summary of Algal Production Facility Capital Cost and 

Operating Costs for Reference and Attainability Cases 

(1984 $1 

Cost Category 

Reference Case Attainability Case 

Percentage Percentage 

$It of Category $It of Category 

Capital Costs 

Culture system 36.0 50.3 16.9 51.3 

Harvester systems 18.3 25.6 8.1 24.7 

Engineering fees 5.9 8.3 2.7 8.2 

Contingency fees 9.1 12.7 4.1 12.6 

Land costs 2.1 .- - 2.9 - 1.0 - 3.1 

Total capital cost 71.5 100.0 32.8 100.0 

Operating Costs 

Labor and overhead 56.1 

Utility costs 18.6 

Nutrient costs 206.8 

Water costs 17.8 

Operating costs 26.9 

Maintenance costs - 37.9 

Total operating cost 364.1 

Total feedstock cost 436.0 224.0 

Table 3. Microalgal Proximate Chemistry and Resulting Energy Content 

Case Lipid Carbohydrate Protein Gross Energy contenta 

(%I (%I (%I (GJ/t algae) 

Low-Lipid 20 49 13 21.6 

Reference 30 20 32 24.9 

High-Lipid 60 9 13 30.1 

a~sh (8%) and intermediates (10%) are constant for all cases, 

SI conversion: 1.0 GJ/t = 430.9 Btu/lb. 

The APEM-derived estimates of algal production cost presented to this 

point were based on variations of photosynthetic efficiency and lipid content, with 

all the other parameters held constant. Several of these other parameters could 

also be improved through continu d researc and development. Carbon dioxide 9 9 cost could be reduced to $0.08/m ($2.30110 SCF) by locating the algal facility 

closer to a coal-fired electric power plant. This would also reduce the cost of 

electric power from $0.05 to $O.OS/kWh. Other nutrient costs could be reduced by 

as much as 10% to reflect contract prices available to a large user. Other parameters for which improved values were chosen include higher source water salinity, 

wider salinity tolerances, and decreased outgassing losses. The algal production 

cost for this integrated attainability case (using the improved values) decreased 

from $263 to $224/t (from $7.80 to $7.43/GJ) (Table 2). This was not the lowest 

estimated cost at which a microalgae feedstock for energy production could be 
Table 4. Effect of Photosynthetic Efficiency and Lipid Content on Algal 

Production Cost (1 984 $) 

. .. 

Photosynthetie Lipid Biomass Praduction Cost 

Efficiency Content Prod ctivity 

(PAR 36) ((%I (10 ! t/yr) $/t $/G J 

SI conversion: $l.OO/GJ = $1.055110~ Btu. 

produced. A lower estimate was developed based on locations where excess C02 

is available (both from flue gas and natural sources), but such locations would be 

the exception and would be available for limited applications. The $224/t cost 

represents a production associated with an extensive technology. 

MICROALGAL REPINERY SCENARJOS 

Methodology 

The concept of a microalgal refinery as developed here is similar to the 

typical petroleum refinery. A crude microalgae feedstock is received from a culture facility, its composition is determined by analysis, and it is then characterized as suitable for producing a specific slate of products. Various processing 

options may be considered, and the final choice is a function of the feedstock, the 

seasonal changes in fuel demand, the availability of essential equipment, and, 

ultimately, economics. In this section, two different production schemes are 

developed, and both center around production of hydrocarbon substitute fuels produced from microalgae that are high in lipids. The characteristics of the proposed 

products, and those required of the feedstock, are examined in some detail, 

thereby establishing the basis for further analysis. 

A simple model was developed that prepares preliminary capital and 

operating cost estimates for each set of conditions. The fuel production options 

discussed below were first matched with all combinations of lipid content and 

photosynthetic efficiency (holding all other parameters constant). The capital and 

operating costs for fuel production, plus the algal production cost, produce a final 

fuel product cost (in real 1984 dollars per unit of product). The microalgal refinery is assumed to'be located near the microalgal culture facility. In addition 

to the case in which the refinery is sized to match the capacity of the culture 

facility, a case is examined in which the refinery is sized to serve ten culture 

facilities, thereby realizing significant improvem ents in conversion costs and thus 

in the finaI selling price of the product. 

Conversion of triglycerides to methyl or ethyl fatty esters (the transesterification process) is employed commercially in the production of fatty alcohols 
(Technical Insights 1980). The process has recently been the subject of extensive 

investigation in the context of fuel production (Freedman and Pryde 1982; Kusy 

1982; Clark et al. 1984). The product of the transesterification reaction, referred 

to here as ester fuel, is being considered as a substitute for petroleum-derived 

diesel fuel. Oxygenated diesel fuel substitutes such as vegetable oils and ester 

fuels are not yet complete replacements for diesel fuel, but interest is especially 

high in the agricultural sector. The diesel engines in use today have been optimized for the properties of hydrocarbon-based fuels. Ester fuel is not a perfect 

substitute, but it outperforms the vegetable oils under essentially all conditions. 

The viscosity of any diesel fuel is critical to its efficient combustion; the 

viscosity of most vegetable oils is higher than ester fuel and No. 2 diesel, which is 

ihe most common grade of diesel for auto, truck, and farm use, by an order of 

magnitude. Ester fuels perform almost as well as No. 2-D in indirect-injection 

(ID11 diesels, but not as well in direct-injection (31) engines (Ryan et al. 1984). 

Ester fuels also typically have higher cetane numbers than No. 2-D, although the 

epplicability of the cetane rating for oxygenated fuels is subject to some question 

at this time (Pryde 1984). 

The two main drawbacks of ester fuel are its tendency toward injector 

fouling (especially in DI engines) and its relatively high pour point (about OOC). 

making it less suitable for use at ambient temperatures below 5'~. Solutions to 

both of these problems, either through the development of additives or some 

modification to the fuels themselves, are technically feasible as research and 

development continue. Fuel value of ester fuel can be as much as 10% lower thar, 

diesel on a volumetric basis, leading to slightly higher fuel consumption; ester fuel 

would presumably have to be sold at a discount relative to diesel to make up for 

the lower energy content. 

Figure 2 shows how the transesterification process might be applied to 

microalgae. The extraction of the lipid feed would presumably be accomplished in 

a single step using a suitable solvent or solvent system (e.g., chloroformmethanol). A dewatering step may be required before .extraction; however, since 

the necessity for dewatering has not been established, these costs have not been 

included. The esterification reaction is accomplished by adding excess alcohol 

w Protein, Extraction 

tower *carbohydrate. 

A -other lip~ds 

Sulfuric acid \ 

\- Neutralization Neutral salts 

Solvent 

strlpper 

Caust~c soda t 

Ethanol Esterlflcat~on 

(or methanol) reactor 

t 

I Flash 

.f I 

1 Wash 1 

Methane 

-Crude glycerol CO, recycle to 

Ester fuel product 

+ . production facll~ty 

Figure 2. Schematic of Transesterification Process 
(generally double the stoichiometric minimum) plus an alkaline catalyst. One 

mole of glycerol is produced for each 3 moles of esters; the glycerol can be 

recovered and then purified in a separate unit for substantially less than its current market value of over 7Wlb ($1540/t). Besides glycerol and the refined ester 

fuel, other by-products are produced. In the microalgal refinery concept we hope 

to maximize the energy production, so all the organic material not extracted for 

ester fuel production is anaerobically digested to produce biogas (a methanecarbon dioxide mixture) and a disposable sludge. Sulfur and carbon dioxide are 

removed from the biogas. The resulting methane is a pipeline-quality fuel gas 

(requiring compression if it is to be transported over long distances), and the 

carbon dioxide is suitable for recycling to the culture facility. Credits are also 

taken for the water and soluble nitrogen (as ammonia), which are recycled to the 

algal production facility. 

One of the most critical parameters in the evaluation of the transesterification process is the utilization efficiency of the algal lipids. As microalgae aUocate larger percentages of their cell mass to lipids, larger percentages in turn 

become storage lipids-those not associated with membranes. At 20% lipid content, only 30% of the total lipids might be suitable for transesterification (i.e., 

triglyceride and possibly phospholipid). At 30% lipids, this proportion will be 

about 4096, and at 60% lipids about 50% will be available for processing. A modified allocation of carbon might increase the lipid fraction available for transesterification to as high as 75%. Conversion from triglyceride to ester fuel is assumed 

constant at 9896, which is routinely achieved industrially (Technical Insights 

1980). A brief summary of the relationships between photosynthetic efficiency, 

lipid content, lipid availability, and ester fuel production is shown in Table 5. 

Increasing the lipid content (and thus the lipid availability) from the reference 

value of 30% to 60% doubles the ester fuel production and halves the cost. 

Increasing the photosynthetic efficiency from 7% to 12% would again decrease the 

production cost by half, to just under $3.0O/gal. 

The analysis of ways to reduce ester fuel cost is accomplished by setting up 

an attainability case for the refinery and integrating it with that of the culture 

facility. Three different fuel cost reduction strategies could be employed to 

reduce the algal production cost of $224/t. First, using the lipid availability estimate of 75%, the production cost can be reduced to $1.94/gal based on annual 

production of 16.4 million gal (up from 10.9 million). Second, the ester fuel cost 

can be calculated for a refinery processing the feedstock from ten 1000-ha culture 

facilities. Ester fuel cost from this 109 million gal/yr plant (using the feedstock 

at $224/t) would be $2.47/gal. Third, incorporating both scale and efficiency 

Table 5. Transesterification: Effects of Photosynthetic Efficiency, Lipid Content, 

and Lipid Availability an Ester Fuel Cost (1984 $) 

Photosynthetic Lipid Lipid Ester Fuel Ester Fuel 

Efficiency Content Available Pr duction $ Cost 

(PAR %) (%) (%I (10 gal/yr) ($/gal) 

Reference case 7 30 40 2.1 11.90 

0 t her cases 

Attainability casea 18 60 75 163 1.63 

aProcesses microalgae feedstock from ten 1000-ha culture facilities; others each process 

feedstock from one 1000-ha culture facility, 

9 
improvements into a facility (producing 163 million gallyr) reduces ester fuel cost 

to $1.63/gal. 

The capital and operating costs for the reference and attainability cases 

are shown in Table 6. Capital costs are listed separately for each of the three 

major process units (ester fuel, glycerol, and methane), while the operating costs 

are the combined totals for all three. The effect of increased plant scale is 

apparent from this table; although the ester fuel production is 80 times higher in 

the attainability case, capital investment and operating expenses have only 

increased by a factor of 12. 

One important caveat in this evaluation of algae-derived ester fuel is the 

sustainability of the market for by-product glycerol. In the reference case, the 

glycerol production is 760 tlyr, but in the attainability case it increases to 

60,000 tlyr, which is 40%-50% of the current domestic market (International 

Trade Commission 1982). Clearly, a new 60,000-t glycerol facility would have a 

dramatic impact on the market price. Natural glycerol (derived from animal and 

vegetable triglycerides as a by-product of soapmaking), like algae-derived 

glycerol, is produced for much less than its current $1540/t market value and 

would be able to withstand price decreases. However, synthetic glycerol (made 

from petroleum-derived propylene), has a production cost much closer to the 

Table 6. Summary of Reference and Attainability Capital and Operating Costs for 

Ester Fuel Production ( 1984 $) 

- -- 

Case 

Reference Attainab~lity 

Capital Costs ($1 06) 

Mein process unit 

Glycerol by-product unit 

Methane by-product unit 

Total 

Operating Costs 

Raw materialsa 27.4 13.05 3 19.6 1.95 

Utilities 0.4 0.19 12.0 0.07 

Labor, maintenance, taxes 1.7 0.81 46.9 0.29 

Depreciation 1.7 0.8 1 20.4 0.13 

Return on investment - 0.6 0.29 - - 5.8 - 0.04 

Total (gross) 31.8 15.14 404.7 2.48 

Credits from By-Product Sales 

Methane 

Glycerol 

Other 

Subtotal (credits) (6.8) (3.24) (138.2) (0.85) 

Main Product Cost 25.0 11.90 266.5 1.63 

a~ncludes algae feedstock at cost shown in Table 2. 
market value, most likely ranging from $1000 to $1200/t. Synthetic glycerol 

facilities would be caught in a cost-price squeeze. It is possible that the very first 

60,000 t glycerol-from-microalgae facility would be able to claim a credit of 

$1540/t by displacing the most expensive synthetic production, but it is doubtful 

that subsequent facilities could sustain a credit that large. The result is a negative effect on the economics of ester fuel from microalgae: each lOj/lb ($220/t) 

decrease in the glycerol credit will further increase the ester fuel cost by 

$0.08/gal. A credit of only $380/t ($0.40/lb) thus increases the ester fuel cost 

$0.24 to $1.87/gal. Smaller facilities that produce 4000 t/yr or less should not 

suffer any adverse affects, at least for the first 10-20 facilities. 

Catalytic Conversion 

The next process to be examined is based on a zeolite-catalyzed methanolto-gasoline process developed by Mobil Research and Development Corporation 

(Voltz and Wise 1976). Mobil also investigated some oxygenated feedstocks larger 

than methanol, notably corn oil (Weisz et al. 1979). As Figure 3 shows, almost 

60% of the product from corn oil is in the gasoline range, and the majority of that 

amount is aromatics of 6 to 8 carbons (i.e., benzene, toluene, and xylene, the 

major aromatic octane enhancers). Another 28% consists of 3- and 4-carbon compounds, prim wily paraffins, which yield a product similar to liquefied petroleum 

gas (LPG). The light-end product would be suitable as a fuel gas, either for 

blending with the digester-produced methane or by itself. The heavy-end product, 

with 11+ carbons, could be suitable for use as a diesel fuel. The process itself is 

basically a catalytic reduction; most or all of the initial oxygen present is 

removed, resulting in the production of hydrocarbons, which, unlike ester fuel, are 

direct substitutes for petroleum-derived products. Figure 4 is a flow diagram 

based on Mobills process. As in the ester fuel case, lipid extraction precedes the 

main process and anaerobic digestion follows it. The possible efficiencies for 

dewatering and lipid extraction depend on the requirements of the process and 

more detailed characterization of the products. 

Fuel 

*O 

range 

15 

- 

- 8 

LPG 

range 

28% 

Gasoline range 

5 8 O/o 

Carbon number 

(Corn oil at 450°C) 

Light, 

aistillate 

range 

9 O/o 

11 12+ 

Nonaromat~cs 2 

(total 13.5%) 

l?zzzza 

Aromatics 

(total 49.9%) 

Olefins 

(total 6.0%) lxsssl 

Paraffins 

(total 

n 

30.7%) 

Figure 3. Product Distribution from Catalytic Conversion of 'higlycerides 

(Source: Weisz et aL 1979) 

The effects of photosynthetic efficiency, lipid content, and lipid availability on the cost of catalytically produced gasoline are briefly summarized in 

Table 7. Again, these cases need to be matched with the appropriate algal production cases from Table 4, plus the integrated attainability case. The analysis 

assumes slightly higher lipid availability fractions compared to transesterification-50% available at 20% lipid content, 60% available at 30% lipids, 80% available at 60% lipids, and 90% of total lipids available in the attainability case. 

These higher availabilities are consistent with those assumed for the transesterification studies. Besides triglycerides, free fatty acids and phospholipids, hydrocarbons (aliphatics and aromatics), and isoprenoids could all potentially be 

converted in this process. The assumed conversion efficiency is 90% on an energy 

basis, which is conservative since Mobil achieved 90%-95% conversions (in the 

original methanol process). 

The economic effects of increasing pholosynthetic efficiency, lipid 

content, and lipid availability are favorable, just as they were in the other process 

scheme examined. At constant 7% photosynthetic efficiency, doubling the lipid 

content to 60% (with an associated increase in lipid availability) decreases the 

gasoline cost by over half; further increases are then achieved by increasing 

photosynthetic efficiency. In the case of 18% photosynthetic efficiency and 60% 

lipids, either the efficiency attainability (increasing the lipid availability from 

80% to 90%) or the scale attainability (sizing the catalytic conversion unit for ten 

culture facilities rather than one) has the effect of reducing the gasoline cost to 

about $1.90/gal. This is a different effect than was seen for the ester fuel, where 

efficiency improvement decreased the cost much more than the scale improvement. Combining the efficiency improvement with the scale improvement, the 

gasoline cost can be reducted to $1.72/gal. 

Summaries of capital and operating costs for both the reference and attainability cases are presented in Table 8. Capital costs in particular are estimated to 

be substantially lower than those of the transesterification process, primarily 

because the latter requires interstage solvent recovery and neutralization steps. 

With regard to the capital cost estimates presented here, two points need to be 

noted. First, these estimates are based on preliminary data. Second, fluctuations' 

in capital costs will have relatively minor effects on the operating costs, since 

depreciable capital contributes less than 10% to the total product cost of either 

process. Another positive factor in this process is that all the major by-products 

are fuels: fuel gas (including methane), LPG, and diesel fuel. No major nonfuel 

(i-e., demand-limited) by-products are required for corn mercial feasibility. 

Table 7. Catalytic Conversion: Effects of Photosynthetic Efficiency, Lipid Content, 

and Lipid Availability on Gasoline Cost ( 1984 $) 

Photosynthetic Lipid Lipid Gasoline EsterFuel 

Efficiency Content Available Pr duc tion Cost 

. (PAR %) (96) (%I (10 (6 gal/yr) ($/gal) - 

Reference case 7 30 60 1.9 12.63 

Other cases 

Attainability casea 18 60 90 120 1.72 

a~rocesses microalgae feedstock from ten 1000-ha culture facilities; others each process 

feedstock from one 1000-ha culture facility. 
Table 8. Summary of Reference Attainability Capital and Operating Costs for 

Gasoline Production (Catalytic Conversion) (1 984 $1 

Case 

Reference Attainability 

Capital Costs ($lo6) 

Main process unit 

Methane by-product unit 

Total 17.2 

Operating Costs 

Raw materialsa 

Utilities 

Labor, maintenance, taxes 

Depreciation 

Return on investment 

Total (gross) 

Credits f.rom Product Sales 

Methane 

LPG 

Diesel 

Other 

Subtotal (credits) 

Main Product Cost 

a~ncludes algae fkedstock at cost shown in Table 2. 

SUMMARY OF AlTAINABLE FUEL PRODUCT COSTS 

A comparison of the cost of production of ester fuels (Figure 5) and catalytically produced gasoline (Figure 6) with the predicted prices for the products 

based on NEPP forecasts indicates commercial feasibility by the year 2000. Most 

optimistic estimates indicate that at least fifteen years are required to develop a 

technology with the required improvements for production at hese lower costs. & The cost of diesel fuel (Figure 5) is estimated to be $13.27110 Btu ($12.58/GJ). 

For ester fuel, which has 10% lower heat of combustion than diesel, this cost 

becomes $1.55/gal. Based on the optimistic (low world oil price) and pessimistic 

(high word oil price) scenarios, diesel fuel price ranges from $8.84 to 

$18.02110 s' Btu ($8.38 to $17.08/GJ), for an ester fuel cost of $1.03-$2.10/gal. 

These values are the low-range and high-range forecasts, respectively. 

All points on Figure 5 represent the high lipid content of 60%. Point A 

shows the 50% lipid availability for the 1000-ha facility size, which has an ester 

fuel cost of $2.96/gal (Table 5). Point B shows the effect if the ester fuel production facility were sized to match the output of ten 1000-ha algal culture 

ponds. In this case, the cost could drop to $2.11/gal if the glycerol credit 

remained at $1540/t, which just reaches the NEPP high-range forecast for the 

year 2000. Such facilities, however, would produce up to 40,000 tlyr of glycerol, 
Target for commercial technology 

1 - d 

13 

1985 1990 1995 2000 2005 2010 

Year 

Projected fuel costs 

H - High-range projection 

M - Mid-range projection 

L - Low-range projection 

Microalgae-based fuel costs 

A - 1000 ha, 50% lipid availability 

B - 10 1000 ha, 50% lipid availability 

C - 1000 ha, 759h lipid availability 

D - 10 x 1000 ha, 75% lipid availability 

6' and D' are the same as B and D but with 

$770/t glycerol credit. 

Figure 5. Comparison of Attainable Ester Fuel Costs with Projected Price of 

Diesel Fuel (Source: Department of Energy 1983) 

more than the current market structure could absorb. With a more likely glycerol 

credit of $770/t (half the current value), ester fuel cost would be $2.40/gal 

(Point Bt). Point C shows the case in which the lipid availability increases to 75% 

without scale-up; the glycerol credit remains at $1540/t, so the ester fuel cost 

drops to $1.94/gal, between the mid-range and high-range forecasts. Point D 

shows the case that incorporates both increased availability and plant scale, with 

the ester fuel cost of $1.63/gal. This cost almost reaches the mid-range cost projection. If the full glycerol credit is again taken away and is replaced with the 

$770/t credit, ester fuel cost increases to $1.9l/gal (Point DT). 

Another way to analyze the glycerol situation of Figure 5 is to say that 

some additional period of time will be required for the development of additional 

glycerol markets, and that the full glycerol credit of $1540/t (or at least a value 

between $770 and $lMO/t) would then be sustainable over larger annual production. If the $1540/t credit of Point D were to be available in 2005, for example, 

the $1.63/gal ester fuel cost would then actually fall below the mid-range projection (since the costs are all in real 1984 dollars with no inflation assumed). 
Target for commercial technology 

I - 

Projected fuel costs 

H - High-range projection 

M - Mid-range projection 

L - Low-range projection - 

Microalgae-based fuel costs 

A - 1000 ha, 80% lipid availability 

B - 10 x 1000 ha, 80% lipid availability 

C - 1000 ha, 90% lipid availability 

D - 10 x 1000 ha, 90% lipid availability 

Figure 6. Comparison of Attainable Catalytically Pmduced Gasoline Costs with 

Projected Price of Gasoline (Source: Department of Energy 1983) 

Figure 6 shows an even more encouraging situation for gasoline. Point A 

represents the high-lipid case with 80% lipid availability, which has a gasoline 

price of $2.62/ga19 somewhat higher than the high-range projection of $2.37/gal. 

Point B (scale-up to ten culture facilities at 80% lipid availability) and Point C 

(90% lipid availability with the smaller scale) are just above the mid-range projection at $1.93 and $1.91/gal, respectively. The year 2000 mid-range projection, 

based on a typical lower heating value for gasoline of 116,500 Btulgal is 

$1.84/gal. Finally, Point Dl, which includes 90% lipid availability plus scale-up, is 

between the low and middle range at $1.72/gal. Unlike Figure 5, there are no 

qualifying statements concerning market limitations of important by-products. 

All by-products from the catalytic conversion process are fue and can be valued % at theig NEPP mid-range projected values ($13.2'1110 Btu for diesel, 

$7.40110 Btu for methane, and $9.25110~ Btu for LPG). Thus there are several 

scenarios in which the catalytic conversion process could be successful in producing competitive liquid fuels from microalgae by the turn of the century. 
CONCLUSIONS 

Microalgae are unique feedstocks that could be a competitive source of 

renewable liquid fuels by the early 21st century. Their two most important attributes to be exploited are their potentially high biomass productivities and higher 

lipid yields. 

Even at this preliminary stage of evaluation, two processes have been identified that offer potential for commercial development. The major fuel products 

produced by these processes are catalytically produced gasoline and ester fuel, an 

oxygenated diesel fuel substitute. 'M 'mum rod ction of liquid fuels in the 

former process is estimated at 2.5 xLl? J ha-Pyr-Y (60% f which is g soline), 

while maximum ester fuel production is estimated at 2.0 1J2 J ha-' yr-8. Economic success of the transesterification process depends to a significant degree on 

the utilization of by-product glycerol, which could be produced in sufficiently 

large quantities to affect its market structure. There are no such problems with 

the gasoline process, since all by-products are either fuels themselves (with no 

assumed upper market limit) or are returned directly to the algal culture facility. 

Neither microalgal mass culture technology nor the processes for 

conversion of microalgae to high energy liquid fuels are in a mature stage of 

development. Both require substantial continued research efforts before commercialization can occur. 

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