Algae Biofuel Market Report 2026

The algae biofuel market size has grown strongly in recent years. It will grow from $9.3 billion in 2025 to $10.15 billion in 2026 at a compound annual growth rate (CAGR) of 9.1%. The growth in the historic period can be attributed to renewable energy research funding, fossil fuel emission concerns, early biofuel pilot projects, availability of non-arable land, government sustainability programs.

The algae biofuel market size is expected to see strong growth in the next few years. It will grow to $14.03 billion in 2030 at a compound annual growth rate (CAGR) of 8.4%. The growth in the forecast period can be attributed to net zero emission goals, aviation biofuel demand, advances in algae biotechnology, carbon utilization strategies, renewable fuel mandates. Major trends in the forecast period include high-lipid algae strain development, scale-up of algae cultivation systems, integration with carbon capture, diversification of algae-based fuels, process cost reduction initiatives.

The rising demand for renewable energy sources is expected to drive the growth of the algae biofuel market in the coming years. Renewable energy refers to clean energy derived from natural sources or processes that are continuously replenished. This increasing demand is fueled by greater awareness of climate change, declining costs of renewable energy technologies, and growing public support for sustainable practices. Algae biofuel provides a sustainable alternative to fossil fuels by using photosynthesis to convert CO₂ into energy-rich compounds, helping reduce greenhouse gas emissions and dependence on finite resources. Its scalability, versatility, and potential for carbon neutrality position it as a promising element of the renewable energy landscape. For example, in December 2024, Eurostat, a Luxembourg-based government agency, reported that renewable sources accounted for 24.5% of gross final energy consumption in the EU in 2023, up by 1.4 percentage points compared with 2022. Therefore, the increasing demand for renewable energy sources is fueling the growth of the algae biofuel market.

Leading companies in the algae biofuel market are focusing on technological advancements such as algae-derived drop-in renewable fuels to deliver sustainable, low-carbon alternatives to conventional fossil fuels and support decarbonization in sectors where electrification is challenging. Algae-derived drop-in renewable fuels are produced by cultivating microalgae with high oil content and converting them into fuels that function like diesel or jet fuel, while generating significantly lower greenhouse gas emissions and avoiding competition with food crops. For example, in August 2025, BRK Technology Company Limited, a Hong Kong-based clean energy company, launched its 2025 Partner Pilot Program for algae-based drop-in renewable fuels. This initiative aims to test and demonstrate algae-based aviation, marine, and heavy-transportation biofuels under real-world conditions, enabling compatibility with existing engines, reducing emissions by up to 80%, and accelerating adoption across sectors such as logistics, construction, mining, aviation, and maritime.

In January 2023, PETRONAS Research Sdn Bhd (PRSB), a Malaysia-based energy technology company, partnered with SEDC Energy Sdn Bhd to jointly develop microalgae oil production technology for sustainable aviation fuel (SAF). Through this collaboration, the companies aimed to enhance technological capabilities in sustainable fuel production by co-developing algae cultivation, harvesting, and extraction processes to support commercial-scale SAF supply and accelerate decarbonization in the aviation sector. SEDC Energy Sdn Bhd, also based in Malaysia, specializes in algae production technologies and related processes for cultivating, harvesting, and extracting crude algae oil that can be refined into sustainable aviation fuel.

Major companies operating in the algae biofuel market are Neste Inc, Alfa-Laval AB, Pond Technologies Inc., Intertek Group plc, EPCM Holdings, PetroTech Holdings Corp., Synthetic Genomics Inc., Joule Unlimited Inc., Reliance Life Sciences Pvt. Ltd., Algenol Biotech LLC, Heliae Development LLC, Solazyme Inc., Aurora Biofuels Inc., AlgaEnergy N.A. Inc., Sapphire Energy Inc., Algae Systems LLC, Inventure Renewables Inc., Genifuels Corporation, Culture BioSystems Inc., Solix Biofuels Inc., HutanBio Limited, GreenFuel Technologies Corporation, Cellana Inc., Manta Biofuel Inc.

North America was the largest region in the algae biofuel market in 2025. Asia Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in the algae biofuel market report are Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the algae biofuel market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Taiwan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The algae biofuel market consists of sales of liquid biofuels, solid biofuels, and chemical feedstocks. Values in this market are ‘factory gate’ values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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