Algae-based biodiesel fuel now available at pump

SAN JOSE, Calif.

One station in San Jose along with three others in Redwood City, Oakland, and Berkeley started selling biodiesel at the pump Monday. It's a cleaner-burning fuel made from algae. The stations looks like ordinary corner gas stations, but the fuel is far from ordinary. It's a blended biodiesel. The oil is made from feeding plant-based sugar to algae.

South San Francisco-based Solazyme says its biodiesel produces 30 percent fewer particulates, 20 percent less carbon dioxide, and 10 percent less hydrocarbons. Propel, based in Redwood City, is offering the cleaner-burning fuel at four locations in the Bay Area with more in the works. "We're showing what the future's going to look like and we hope that others will follow suit and follow our example, and bring cleaner fuels to the public," Propel Fuels CEO Matt Horton said.

At $4.23 a gallon, the biodiesel costs the same as regular diesel. However, Solazyme expects the price to fall into the same range as gasoline as it ramps up production. "We do have one facility in the United States today that's producing demonstration-scale quantities of our oil. That's in Peoria, Illinois. And, we're building commercial plants. The first that we've announced is down in Moema, Brazil, but we've got others that we haven't yet announced but are coming online in the near future," Solazyme Vice President Bob Ames said.

Demand is also expected to be strong among commercial fleets such as delivery vans and service vehicles. Solazyme sees a broad market for its algae-based oil. It has been working with airlines, the navy, and with carmakers on alternative fuels to reduce foreign oil dependence. Its work with algae in the lab has even produced a line of high-end cosmetic creams. "It can be used to produce not just biodiesel like we see in the pump here today, but also renewable diesel, renewable jet fuel, conventional sort of military-grade spec fuels... So, a full range of fuels," Ames said.

Propel and Solazyme will be using the fuel stations to get feedback from consumers. With the price of both biodiesel or regular diesel the same, consumers will be getting a choice for the very first time.

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