two years ago, algae-baed fuel production was just starting out. the industry was speculative, and a few venture capitalists dominated the field. now the department of energy is releasing a $57 million tidal wave of funding for 33 small businesses specializing in alternative fuel production, among them algal biodiesel and algae-based jet fuels for the pentagon.

algae is just one of many potential investments for the forward-thinking venture capitalist. some bioengineers are even aiming for the holy grail of the so-called “third generation biofuels” – producing ethanol from algae without damaging the algae itself. with fewer environmental and economic problems than corn-based ethanol, the case for hard-working algae is beginning to grow on america’s policymakers.