An algae farm could be located almost anywhere. It wouldn't require converting cropland from food production to energy production. It could use sea water. And algae can gobble up pollutants from sewage and power plants.

The Pentagon's research arm, the Defense Advanced Research Projects Agency, is funding research into producing jet fuel from plants, including algae. DARPA is already working with Honeywell's UOP, General Electric Inc. and the University of North Dakota. In November, it requested additional research proposals.

As the single largest energy consumer in the world, the Defense Department needs new, affordable sources of jet fuel, said Douglas Kirkpatrick, DARPA's biofuels program manager.

"Our definition of affordable is less than $5 per gallon, and what we're really looking for is less than $3 per gallon, and we believe that can be done," he said.

Des Plaines, Ill.-based UOP — which has developed a "green diesel" process that converts vegetable oils into fuels that are more like conventional petroleum products than standard biodiesel — already has successfully converted soybean oil into jet fuel, Holmgren said. And the company has partnered with Arizona State University to obtain algae oil to test for the DARPA project, she said.

At the University of Minnesota, Ruan and his colleagues are developing ways to grow mass quantities of algae, identifying promising strains and figuring out what they can make from the residue that remains after the oil is removed.

Because sunlight doesn't penetrate more than a few inches into water that's thick with algae, it doesn't grow well in deep tanks or open ponds. So researchers are designing systems called "photobioreactors" to provide the right mix of light and nutrients while keeping out wild algae strains.

Ruan's researchers grow their algae in sewage plant discharge because it contains phosphates and nitrates — chemicals that pollute rivers but can be fertilizer for algae farms. So Ruan envisions building algae farms next to treatment plants, where they could consume yet another pollutant, the carbon dioxide produced when sewage sludge is burned.

Jim Sears of A2BE Carbon Capture LLC of Boulder, Colo., a startup company that's developing fuel-from-algae technologies that tap carbon dioxide from coal-fired power plants, compared the challenges to achieving space flight.

"It's complex, it's difficult and it's going to take a lot of players," Sears said.