Algae Biofuel Market Size, Share, and Industry Analysis By End-User (Transportation, Aviation, and Others), and Regional Forecast, 2025-2032

The algae biofuel market refers to the industry and economic activities associated with the production, commercialization, and distribution of biofuels derived from algae. Algae biofuels are considered a renewable source of energy that can be used as a substitute for conventional fossil fuels.

Algae biofuels are seen as a way to reduce carbon emissions compared to fossil fuels, helping to combat climate change. Algae can absorb CO₂ and other pollutants during growth, contributing to cleaner air and water. Algae biofuels offer an alternative to traditional fossil fuels, lowering dependence on imported oil and improving energy security.

Government financial support for research and development, together with production subsidies, helps lower the economic barriers to market entry. Private companies and venture capitalists are growing their investment in algae biofuel technologies and projects. Mandates and quotas for renewable energy usage drive demand for biofuels, comprising those derived from algae.

Vendors and companies form strategic partnerships in which both parties invest resources, including capital, to achieve mutual business goals. This leads to shared profits and business growth. In February 2022, International oil and gas company ExxonMobil partnered with biotechnology company Viridos to research and produce biofuel from algae. The companies signed a joint agreement for the commercial production of Veridos bio-carbon biofuels. Viridos is pleased to announce that ExxonMobil continues to work with them to bring sustainable algal biofuel technology closer to commercial deployment.

The COVID-19 pandemic caused major disruptions in global supply chains, influencing the availability of raw materials and equipment needed for algae biofuel production. This led to delays and increased costs for many projects. Many R&D activities were halted or slowed down due to lockdowns and social distancing measures. Laboratories and research facilities faced operational challenges, leading to delays in ongoing projects and innovations in algae biofuel technology.

KEY INSIGHTS

The report covers the following key insights:

• Recent Advancements in the Algae Biofuels Market
• Key Industry Trends
• Regulatory Landscape for Algae Biofuels Market
• Key Industry Developments (Mergers, Acquisitions, and Partnerships)
• Impact of COVID-19 on the Market

SEGMENTATION

ANALYSIS BY END-USER

By type, the market is segmented into transportation, aviation, and others. The transportation segment dominates the market and is expected to grow significantly during the forecast period. Algae biofuels have a high energy density, making them ideal for transportation use. This is particularly important for sectors, such as aviation and shipping, where energy density is a critical factor. Algae biofuels can be utilized in existing internal combustion engines with little or no modification. This makes them an attractive substitute for fossil fuels for transportation, as they can utilize the current infrastructure. The transportation segment dominates the algae biofuel market due to the high energy density of algae biofuels, their compatibility with existing infrastructure, and the global push to lower greenhouse gas emissions.

The aviation industry is under growing pressure to lower its carbon footprint. Sustainable aviation fuel (SAF) derived from algae offers a viable alternative to conventional jet fuel, helping the industry meet stringent environmental regulations and sustainability goals. Algae-based biofuels can be used in existing jet engines without significant modifications. This drop-in capability makes it easier for airlines to adopt algae biofuels without incurring the high costs associated with overhauling current fleets.

REGIONAL ANALYSIS

The Algae Biofuels Market has been studied across North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa. Asia Pacific is anticipated to dominate and increase at a considerable growth rate during the predicted period. Many countries in the region have the ideal climate and geographic conditions for large-scale algae cultivation. Warm temperatures, abundant sunlight, and coastal areas provide excellent environments for algae growth. Asia Pacific is home to numerous research institutions and universities that are actively participating in algae biofuel research. Collaborations between academic institutions, government agencies, and private companies are fostering innovation and advancements in algae biofuel technology. Several countries in the region are making strategic investments in biofuel production facilities and infrastructure. Public and private sector investments are boosting the development and commercialization of algae biofuels.

North America, particularly the U.S., is home to many leading research institutions and universities that are at the forefront of algae biofuel research. Extensive R&D efforts have led to significant advancements in algae cultivation, harvesting, and biofuel extraction technologies.

KEY PLAYERS COVERED

Some major companies in the algae biofuel market are Culture Biosystems, Proviron, Genifuel, Algae Systems, Solix Biofuels, Reliance Life Sciences, Harris Group, Origin Oils, AlgaEnergy, and Algenol.

KEY INDUSTRY DEVELOPMENTS

• In March 2023, United Airlines made a USD 5 million investment in Viridos. This leading algae biofuels company plans to produce sustainable, low-carbon algae-based jet fuel at commercially viable levels. Compared to conventional fuel, Viridos Algal Oil Sustainable Jet Fuel (SAF) is expected to reduce its carbon footprint by 70%, making it an efficient and more environmentally conscious alternative.
• In March 2022, AECOM, the world's trusted infrastructure consulting firm, declared that it has entered into a strategic agreement with Genifuel Corporation to produce carbon-neutral, sustainable jet fuel (SAF) and biogas from forest algae and biosolids. The partnership uses a proprietary process developed by AECOM to harvest wild algae and a proprietary process developed by Genifuel and the US Department of Energy to convert algae and wastewater biosolids into renewable oil and gas.