November 22, 2010
With the current popularity of surveys and market reports estimating the growth projections of the algal industry, as well as assessing it’s hurdles, the Algal Biomass Organization (ABO) has issued a statement to put these reports into perspective.
According to ABO Executive Director, Mary Rosenthal, “We encourage meaningful review and study of the vast potential that algae-based fuels hold. We recognize that it is difficult, perhaps impossible, for any study to accurately predict the future, given that few if any researchers have access to the proprietary data, intellectual property, and breakthroughs being made by some of the industry’s most advanced algae fuels players. And no study can possibly foresee the emergence of new innovations happening in labs across the country.
“As such, we caution everyone to accept the studies and forecasts for what they are—best attempts at drawing conclusions from the best available information at that time. It would be misguided to either become too bullish, or too pessimistic, in response to any conclusions made by these studies unless and until we start seeing commercial projects come online.
“If these various studies give me pause on any issue, however, it’s their tendency to compare future algae projections with today’s reality. If we’re going to project algae production ten years in the future, then we should make that projection with an understanding of what the market for fossil fuels is going to look like in ten years, too.
You might be surprised to learn that the U.S. Energy Information Agency is projecting that by 2020 crude oil will be at $119 per barrel and gasoline will be at $4.07 per gallon.
“Even more troubling is the prediction by the International Energy Agency of a shift among oil producing nations towards a greater role for members of the Organization of Petroleum Exporting Countries, which by 2023 would generate more than half of the global output. This means more of the global supply of oil will be controlled by state-run entities, making it more difficult for oil majors to access new reserves.
“What people should be most concerned about, however, is a recent study from the University of California, Davis. The study predicts the global oil supply will run out a full 90 years before the supply of alternatives is sufficient to meet demand unless there are major changes in biofuels policy. This sobering forecast should serve as a wake-up call to everyone that we need to find new and renewable sources of liquid fuels as quickly as possible, and that aggressive policies that promote the continued development of a U.S. biofuels industry are critical.
“There will likely be more studies and projections in the future, some of which claim that our industry is years—or even decades—away from producing biofuels from algae at commercial scales. While we all recognize that there will be learning for our industry along the path to commercial production levels, under-promising and over-delivering is the smart approach.
“And I’m confident we will over-deliver. In fact, I’m betting on the tremendous innovation and hard work going on in our industry. We just might surprise all the bears.”