In 1960, Oswald and Golueke presented a conceptual techno-economic analysis, "The Biological Transformation of Solar Energy", proposing the use of large-scale raceway ponds to cultivate microalgal on wastewater nutrients and then to anaerobically ferment the algal biomass to methane fuel. The methane was to be converted into electricity, with the CO2-containing flue gas recycled to the ponds to support algal production. Over the past forty years a great deal of research has been carried out on this and similar concepts for microalgae fuels production and CO2 utilization. However, major technical challenges have limited the practical application of this technology: the difficulties of maintaining selected algal species in large-scale production systems, the lower-than anticipated biomass productivities and methane yields, and the high costs of harvesting the algal biomass and of the overall process. These limitations can, however, be overcome by applying such processes where additional economic benefits, such as wastewater treatment or nutrient recovery, are available and where relatively large systems (> 100 hectares) can be deployed, allowing economics of scale.
One such site is the Salton Sea in Southern California, into which over 10,000 tons of nitrogen and phosphate fertilizers are discharged annually by three small rivers draining large tracts of irrigated agriculture. Removal of nutrients from these inflows is required to avoid eutrophication of this large (some 900 km2), shallow, inland sea, with resulting massive algal blooms, fish kills and other environmental impacts. Nutrient capture could be accomplished with some 1,000 hectares of algal pond systems, with the algal biomass harvested and converted into fuels and the residual sludge recycled to agriculture for its fertilizer value. A techno-economic analysis of this process, based on nutrient removal defraying a fraction of the costs, suggests that such a process could mitigate several hundred thousand tons of fossil CO2 emissions at below $10/ton of CO2-C equivalent.