The U.S. government has just funded a $80 million research for biofuels, and the majority of that money will go into studying algae-based biofuels.
The journal Environmental Science and Technology recently published a study proving that algae production releases more carbon dioxide than the algae consume, by being needing energy intensive processes, whereas corn, canola or switchgrass do the opposite – they sequester the CO2.
The reason that algae biofuels need energy is because they grow on water and need to be fed with fertilizers. Producing those fertilizers consumes energy. One solution would be feeding the algae with municipal waste, the study reveals.
Although algae is energy intensive to grow, it has the advantage that it does not compete with food crops, and that makes it a better solution somehow. Various companies have invested resources in algae biofuel research, including Exxon Mobil, who last summer put $600 million for one such research project.