CHICAGO, April 30 (UPI) -- As climate change and rising oil prices intensify the search for alternative energy sources, researchers are on the brink of commercializing algae for fuel, experts say.

These small, plantlike organisms could be used as feedstocks for ethanol or other biofuels, replacing some of the traditional sources of ethanol, such as corn or soybeans.

Algae possess several characteristics that could propel them to the forefront of the renewable fuels industry. Top among these qualities is the ability to grow rapidly and with few inputs, such as fresh water or fertilizer, said Thomas Byrne of Byrne and Co. Ltd., a firm that provides advice on renewable energy projects.

"Algae grow pretty much everywhere in the world … (and) it doesn't draw from drinking water," Byrne said at discussion on algae at the World Congress on Industrial Biotechnology and Bioprocessing in Chicago this week. "One of the arguments against (traditional) ethanol is that grain-based fuels use a fair amount of groundwater."

Water usage has become an increasing concern in energy production, as groundwater levels decrease and demand rises, according to a recent Virginia Tech study that ranked corn ethanol at the bottom of the list for high-water usage. Algae also require water to grow, but only brackish or polluted water, not drinking water.

Other concerns about traditional ethanol have surfaced lately, including the land requirements associated with growing corn as a feedstock. Algae avoid these problems, because cropland is not required to produce the organisms.

Algae can also act as a sink for carbon dioxide because they absorb it for photosynthesis.

Best of all, a number of companies say they can produce the alternative feedstock economically, including Ben Cloud of XL Renewables.

"The economic value of algae products is high and certainly sufficient for profitable production today," Cloud said.

XL Renewables plans to launch its algae-production technology in November. The Super Trough System utilizes shallow troughs to grow the algae, and CO2-enriched air is distributed over the troughs to feed the burgeoning organisms below.

In current tests, the system produces a yield range of 50 tons per acre, but Cloud said only 10.17 tons is required to be potentially profitable. However, he speculates future advances will lead to much higher rates of production.

"Algae's a very simple organism, and it's easy to identify (positive) characteristics and breed for them," thus increasing yields, Cloud said. He projects future rates as high as 100 to 150 tons per acre.

In reality, though, that rate isn't feasible, said Drgoljub Bilanovic, professor of environmental studies at Bemidji State University in Minnesota.

"Photosynthetic machinery which is in all green things can harness a maximum of 9 percent of solar energy," Bilanovic told United Press International.

That translate, theoretically, into 99 tons per acre, but no one's close to reaching that with today's technology, Bilanovic said.

Even if producers fail to meet Cloud's projected production rates, though, algae could still be profitable. And XL Renewables' trough system isn't the only option out there. The Alberta Research Council in Canada has focused on algae's potential to reduce CO2 through a Carbon Algae Recycling System.

The research project aims to sequester the high-carbon flue gas produced by coal-fire power plants in algae, said Quinn Goretzky of the Research Council.

"We want to take 40 to 45 percent of industrial flue gas released into the atmosphere and run it through our system to reduce the amount of CO2 in our atmosphere," he said.

The algae could then be used for a variety of purposes, including as a biofuels feedstock of animal feed.

The algae will be grown in open pond systems, with structures on top to protect the algae from snow during cold weather. The Research Council is looking at a variety of ways to increase yields, including projecting light further below the surface to raise photosynthetic productivity, Goretzky said. Another important factor is selecting the right kind of algae.

"There are over a million different strains of algae in Canada alone," Goretzky said. "We've worked with 21 samples, and, so far, the indications are quite promising."

The project will complete its first stage this year, and Goretzky said they hope to begin building lab-scale demonstration facilities before the end of 2008.

As algae producers turn to commercial-scale facilities, an important consideration is location, experts said at the Biotechnology Conference. Some possibilities include building adjacent to coal-fire power plants, to be close to a source of CO2, or next to ethanol plants, to decrease transportation of the algae once it's grown. Others are considering utilizing the wastewater produced by municipalities, although that particular possibility has potential drawbacks, said Byrne of Byrne and Co.

"There is some concern with that because many municipalities put chemicals in their systems to kill algae, so that could be problematic," he said.

Despite the many advantages, Algae also have some drawbacks, such as their requirement for light to grow. If producers use electricity to generate light or increase temperatures in an effort to increase productivity, it may take more energy to produce the algae than the algae will provide. Also, it takes more algae to produce a gallon of ethanol than corn, Byrne said.

"It takes more quantity to run through (the biorefinery) because it's not as high in starch as corn," he told UPI.