Big Oil Firms Touted Algae as Climate Solution. Now All Have Pulled Funding

March 20, 2023

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by Amy Westervelt (The Guardian) Insiders aren’t surprised as ExxonMobil, the last remaining proponent of green algae biofuel, ends research -- Algae research was central to Exxon’s green marketing campaigns for years, and frequently criticized as greenwashing rather than a genuine research effort.

But several of its former research partners told the Guardian that it was serious about the potential of algae biofuels – explaining why it stayed in the field long past the point at which other oil companies dropped out – but not serious enough.

In its 12 years in the space, Exxon invested $350m in algae biofuels, according to spokesperson Casey Norton. (Norton says that’s more than double what the company spent on touting this research in ads.)

Even so, every algae researcher who spoke to the Guardian said a real effort to commercialize biofuels, algal or otherwise, requires several billion dollars, and a long-term dedication to overcoming seemingly fundamental biological limitations of wild organisms. And no oil company was willing to go that far.

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The appeal of algae as a feedstock for biofuels was twofold: because they grow in large concentrations in ponds, they don’t compete with food crops for arable land. And some strains produce large amounts of lipids – fatty acids that can produce an oil, which can be turned into fuel relatively easily. But competing with abundantly available and heavily subsidized fossil fuels, particularly gas, was not so easy.

One of the biggest challenges was that wild strains of algae couldn’t deliver the high levels of lipids needed to produce large quantities of fuel, said Todd Peterson, the former CTO of Viridos, Exxon’s longstanding and now former algae research partner.

That’s why Viridos was focused on genetically modifying the organisms to maximize lipid production.

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Viridos laid off 60% of its workforce after Exxon’s December 2022 withdrawal from the sector, which was only revealed by Bloomberg last month. On Monday, Viridos announced a $25m round of funding led by Bill Gates’s Breakthrough Energy, with Chevron and United Airlines contributing as well.

Despite making enormous progress over the past decade, most algae researchers say algae biofuels at the sort of scale necessary to meet current fuel demands are still at least a decade, and more likely two decades, away. It is possible that more investment during the years in which oil companies touted their investments in the space would have moved the needle faster. Exxon ultimately invested just over half of the $600m it once promised back in 2009, according to Norton.

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The first big investments in algal biofuels research happened during the 1970s, when oil supply was constrained thanks to the Opec embargo against the United States, and all the oil majors plowed funds into alternative fuels and renewable energy tech.

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All the researchers who spoke to the Guardian agreed: what was needed to make algal fuels a success was a longer runway and funding in the billions – closer to what oil companies spend on fossil fuels. READ MORE

Exxon drops algae research, but Colorado labs press on in hunt for green fuel -- Technologies that are quicker to scale are now ExxonMobil’s focus. The Colorado labs the petroleum giant funded still see potential in algae as a biofuel. (Colorado Sun)

Excerpt from Colorado Sun: il giant ExxonMobil’s decision to abandon its 14-year, multi-million-dollar support for research into making fuel from algae ended years of funding for projects at the Colorado School of Mines and the National Renewable Energy Laboratory.

Backing for research into developing high-yield algae at Mines was terminated at the end of last year and a NREL project to develop a computer model to test farm-scale biofuel productivity will conclude this spring.

“When Exxon funded our lab, it was always about basic science,” Matthew Posewitz, a Mines chemistry professor, said. Exxon provided millions of dollars in the search and development of fast-growing algae.

“They are very supportive of the research, but now they are funding other carbon capture research,” Posewitz said.

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Since 2009, Exxon has spent $350 million on projects to develop a fuel from the lipids — a fatty acid — in algae.

The company touted its research in print, video ads and on social media platforms, such as Instagram and Facebook. There was even a prediction that 10,000 barrels of biofuels could be produced by 2025.

The efforts, however, also drew criticism from some environment groups, which contended that the project was just greenwashing — misleading information to make Exxon look environmentally friendly.

At the end of 2022, Exxon began to unwind its support for algae, cutting funding to Viridos Inc. a California biotech company that had been the oil company’s prime partner in algae fuel development and then concluding the Mines and NREL projects.

“Algae still has real promise as a renewable source of fuel, but it has not yet reached a level we believe is necessary to achieve the commercial and global scale needed to economically replace existing sources of energy,” Todd Spitler, an Exxon spokesman, said in an email.

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Exxon is shifting to focusing on technologies that it says can be scaled-up more quickly, such as carbon capture and hydrogen — move that was reinforced by subsidies for those technologies in the Biden administration’s Inflation Reduction Act, Exxon’s CEO Darren Woods said during the company’s fourth quarter earnings call.

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The decision ended an eight-year partnership with the Posewitz Research Group in a search for fast growing algae — an aquatic, often microscopic, organism that, like land-based plants, lives through photosynthesis.

“They are photosynthetic organisms that are incredibly efficient,” Posewitz said.

For developing algae fuels two key challenges are growing enough algae — biomass — and increasing the lipid content of each organism. Posewitz’s lab has “focused on maximizing bio-productivity.”

Posewitz and Exxon looked for hearty algae in the hottest, saltiest bodies of water, including California’s Mono Lake, the Great Salt Lake and the Gulf of Mexico.

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The winner was Picochlorum celeri, which was able to double its biomass in as little as two hours, 20% to 75% faster than other cell lines.

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As promising as P. celeri is, one drawback is that it’s not a particularly good lipid producer, Posewitz said. Viridos has been working on increasing the lipid content of test algae.

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Exxon’s NREL project built a computer simulator of a pond to test the impact of farm-scale operations on biomass and biofuel yield and the effects of different engineered algae strains, according to a statement from the lab.

The Exxon project, the statement said, was designed to run three years, concluding this spring with results published “in the near future.”

David Glickson, an NREL spokesman, said the backing for the project is part of a $100 million, 10-year agreement between Exxon and NREL struck in 2019 for a range of projects. That is the largest financial commitment to the lab, outside government funding.

NREL has been doing research on algal fuels for more than 10 years and will continue its ongoing research into developing algae strains, cultivation, carbon capture and product conversion technology to market adoption, the statement said.

Most of the work is funded by the U.S. Department of Energy’s Bioenergy Technologies Office, the statement said. READ MORE