Production of algal crude oil has been achieved in various pilot scale facilities, but whether algal fuels can be produced in sufficient quantity to meaningfully displace petroleum fuels, has been largely overlooked. Limitations to commercialization of algal fuels need to be understood and addressed for any future commercialization. This review identifies the major constraints to commercialization of transport fuels from microalgae. Algae derived fuels are expensive compared to petroleum derived fuels, but this could change. Unfortunately, improved economics of production are not sufficient for an environmentally sustainable production, or its large scale feasibility. A low-cost point supply of concentrated carbon dioxide colocated with the other essential resources is necessary for producing algal fuels. An insufficiency of concentrated carbon dioxide is actually a major impediment to any substantial production of algal fuels. Sustainability of production requires the development of an ability to almost fully recycle the phosphorous and nitrogen nutrients that are necessary for algae culture. Development of a nitrogen biofixation ability to support production of algal fuels ought to be an important long term objective. At sufficiently large scale, a limited supply of freshwater will pose a significant limitation to production even if marine algae are used. Processes for recovering energy from the algal biomass left after the extraction of oil, are required for achieving a net positive energy balance in the algal fuel oil. The near term outlook for widespread use of algal fuels appears bleak, but fuels for niche applications such as in aviation may be likely in the medium term. Genetic and metabolic engineering of microalgae to boost production of fuel oil and ease its recovery, are essential for commercialization of algal fuels. Algae will need to be genetically modified for improved photosynthetic efficiency in the long term.
