ExxonMobil’s Algal Biofuel “Breakthrough” Is Significant – but Not a Real Breakthrough

Last week, ExxonMobil and Synthetic Genomics jointly announced they doubled the lipid content of an algae strain from 20% to 40% without significantly hindering the strain’s growth. The news comes on the heels of the second renewal of their joint research agreement originally started in 2009 and is the biggest breakthrough yet to come out of this partnership. According to the published research paper, the team used the CRISPR-Cas9 genome editing system to inhibit a gene that suppresses lipid production in the algae.

Lipid content is the most influential factor in the production cost of algal biofuels. We previously estimated the cost of algal fuels at $13.50 per gallon of gasoline equivalent (GGE) for an algae with 25% lipid content. However, increasing the lipid content to 40% only brings the fuel cost down to about $9.40/GGE, still a long way from the U.S. Department of Energy (DOE)’s target of $5.00/GGE by 2019. This improvement moves the needle in the development of algal fuels, but many more breakthroughs will be needed for the technology to reach commercial viability. This new development comes at a time where interest in algae fuels sharply collapsed, causing surviving algae developers to pivot into alternative markets. While consumer perception will curb the use of genetically engineered algae strains in food, animal feed may be a promising alternative target market although the technology will struggle to compete with inexpensive fish meal lipid alternatives. ExxonMobil’s and Synthetic Genomics’ announcement steers algal biofuels in a positive direction after years of failed promises but readers should remain cognizant that algae will unlikely be an economically viable technology solely for biofuels.

By: Runeel Daliah and Arij van Berkel