ooto.info

This post is a recap and review of a Web 2.0 Summit session from October, 2009.

This was another great session from the Web 2.0 Summit in San Fransisco.  In this presentation, Cynthia (CJ) Warner of Sapphire Energy talked about algae oil and the current state of energy. She talks about bio fuel solutions and she compares and contrasts Algae-based fuel and Ethanol.  It’s less than 14 minutes long.  Algae seems to have a ton of promise for our future fuel needs. 

CJ says that the World Energy Market is MASSIVE – about $5.8 trillion today and will break $10 trillion by 2020.  Unfortunately, today’s energy system is unsustainable.  The US hit our peak production in 1970 and we've hit peak world-wide oil production as well. 

The first problem with the system is that the demand keeps going up and oil production won’t be able to match demand.  The second problem is that burning all that oil this century could be / probably is / definitely is causing a major environmental problem (depending on your environmental and political views).  So when CJ was an oil exec at BP, she began to become concerned about these problems and decided to leave big oil and move to run a startup.

CJ points out some really interesting facts.  In 2008, the US produced 4% of our energy supply using corn-based ethanol which required 23 million acres of land.  If we had used that 23 million acres for algae crops, we would have produced 50% of our fuel requirements.  To provide 100% of our US transportation needs, we’d need about 50 million acres of algae or 600 million acres of corn.  The map below is a great visual.  Basically, algae is truly scalable.

Secondly, CJ says that algae is a “drop-in fuel.”  Drop in means that “[algae] is essentially identical, for all intents and purposes, to the fuel that we use today.”  It’s the same high-quality and energy density compared to the fuel we use today. 

Why is that important?  Ethanol is NOT compatible with today’s infrastructure.  According to CJ, we’ve invested $12 trillion on our fuel infrastructure (including pipelines, refineries, tanker trucks, engines and jet turbines).  Algae can use that same infrastructure.  To mass deliver Ethanol and use it in our vehicles and jets, we’d have to make a new massive investment.

She doesn’t say this but let’s compare “gas” to E85.  I put E85 in my GMC Yukon XL last summer.  I usually get up to 18 mpg around town in my truck.  With the E85, I paid about $0.10 less per gallon that “gas” but I only got about 12 mpg.  Let’s look at prices today.  Around Dallas, E85 is currently anywhere from $2.06 to $3.50 (I had to call the station that listed $2.06 because that seemed way too low – it’s actually currently $2.41 and I had to talk to a store manager because they aren’t allowed to give the price over the phone because it changes all the time…  whatever…).  DallasGasPrices.com says that our current cheap price of regular unleaded is $2.46 and the national average is $2.75. 

Ok, time for soft math.  12 mpg is 33% less than 18 mpg.  There’s a significant difference in power available in a gallon of E85 than regular unleaded gasoline.  So my test was pretty weak but Edmunds did a pretty good comparison and found that E85 gave them 26.5% less distance per gallon on E85 than gas.  I was pretty close.

E85 is about $0.05 cheaper than gas right now in my area.  Even if you can find it $0.15 less per gallon, you’re looking at a 5% price benefit (at the national average regular unleaded price).  5% less cost for 26.5% less power?  That’s a bad trade-off.  Like the lottery, this is just a tax on people who are bad at math.  The aforementioned Edmunds report found that E85 was 22.8% more expensive to run than gas. 

In a test with Continental Airlines, a renewable fuel blend including algae was used in one turbine while standard fuel was used in the other engine.  The pilot remarked that he had to throttle the renewable-powered turbine back because it was twisting him.  Basically, we can expect that algae-based fuel will provide basically the same power to our vehicles as our current gasoline.

Ok – environmental benefit.  Algae is low carbon.  You need to check out what CJ says at 8:30 – basically, algae eats industrial waste…  Mind blowing!  Also, “algae likes to grow in the desert” because of the abundance of sun.  It also uses salty water.  In short, Algae doesn’t compete with our farm-land or drinking water and can consume industrial CO2!  If you though making fuel from used fryer grease was a good idea, how about converting industrial waste into fuel?  I like it!

I’m sure there has to be some Algae drawbacks but I haven’t found any.  There’s a ton of potential here!