02 - 08 - 2026

Can Microalgae Clean Up India’s Transport Economy?

In a country where local civic authorities routinely struggle with the eutrophication of urban water bodies, an engineering graduate in Ranchi, Jharkhand, saw a strategic asset floating on polluted ponds.

Vishal Prasad Gupta, an alumnus of the Birla Institute of Technology, Mesra, transformed microalgae—known locally as kaai—into a commercial bio-diesel and bio-ethanol venture trading under the brand More Mileage. By harvesting aquatic biomass, drying it, and extracting lipids through solvent processing,

Gupta’s enterprise established an indigenous production facility capable of supplying thousands of liters of refined biofuel daily to local commercial users, including regional industrial units and transport operators.

Decarbonizing transport

This hyper-local venture encapsulates a crucial debate across India’s energy landscape. As the world’s third-largest oil consumer imports more than 85 percent of its crude requirements, New Delhi faces an existential need to decarbonize its transport sector while safeguarding energy security.

While headline investments remain dominated by battery electric vehicles (EVs), circular-economy innovations utilizing third-generation (3G) algal biofuels raise a fundamental question for policymakers and investors alike: Can advanced biofuels achieve mainstream scale to challenge traditional petroleum, or will electric mobility render liquid fuels obsolete?

Enter the Economics of Microalgae

Unlike first-generation biofuels derived from food crops such as sugarcane and corn—which provoke severe food-versus-fuel dilemmas and heavy water consumption—algal biomass offers unmatched yield efficiency per hectare. Microalgae can double their biomass within hours, contain high lipid contents suitable for hydro-treated vegetable oil (HVO) or biodiesel, and thrive on non-arable land using wastewater or polluted runoff.

By absorbing dissolved nitrates and carbon dioxide during photosynthetic growth, the feedstock renders the extraction process functionally carbon-negative prior to combustion. However, the transition from decentralized regional success to national scale presents formidable chemical and capital expenditure hurdles.

Processing raw algae requires energy-intensive dewatering, drying, and chemical extraction—often utilizing solvents like hexane. At an industrial scale, maintaining strain purity, preventing pond contamination, and recovering extraction chemicals economically remain significant engineering bottlenecks.

While startups like More Mileage demonstrate that decentralized open-pond harvesting can deliver competitive retail pricing against heavily taxed fossil diesel in regional pockets, displacing millions of barrels of daily crude demand requires standardized, high-throughput photobioreactor infrastructure that demands substantial up-front capital.

India’s Energy Trilemma

The narrative that electric vehicles will completely eclipse internal combustion engines overlooks the structural realities of Indian transportation. Electrification is accelerating rapidly in the urban two-wheeler, three-wheeler, and passenger car segments, bolstered by government production-linked incentive schemes and fleet aggregators.

Yet, battery chemistry faces physical and economic constraints in heavy-duty long-haul freight, inter-city logistics, maritime transport, aviation, and off-grid agricultural machinery. India operates millions of commercial diesel vehicles with asset lifespans stretching well over a decade.

Replacing this legacy capital stock with high-capacity battery-electric heavy trucks would require trillions of rupees in grid upgrades, ultra-fast charging corridors, and vast imports of critical minerals such as lithium, cobalt, and nickel. Drop-in algal biofuels, which conform to existing BIS standards for diesel engines without requiring modifications to fueling infrastructure or internal combustion architecture, offer an immediate decarbonization pathway for heavy transport that electricity cannot realistically serve in the near-to-medium term.

A Dual-Track Future for India’s Energy Transition

Rather than a zero-sum contest between electric power and liquid fuel, India’s decarbonization pathway will inevitably follow a dual-track framework. Electric mobility will dominate intra-city transit, light commercial deliveries, and personal urban commuting. Concurrently, advanced biofuels—anchored by compressed biogas, ethanol blending targets, and third-generation algal fuels—will form the backbone of commercial freight, heavy industry, and regional energy independence.

Ventures like Gupta’s in Jharkhand prove that frugal Indian engineering can turn environmental liabilities into local fuel security. If policy frameworks under the National Policy on Biofuels can mobilize institutional capital into scaling microalgae processing facilities, algal biofuel will not need to defeat the electric vehicle to succeed. Instead, it will secure a vital, highly lucrative market powering the heavy machinery and long-distance transport that keep India’s economy moving.

The development also needs to be seen in the light of India’s Ministry of Petroleum and Natural Gas issued a detailed rebuttal last week regarding the claims surrounding the Ethanol Blended Petrol (EBP) program. Authorities called it “misleading”, insisting there is no scientific or real-world evidence that E20 fuel is wrecking engines, crippling vehicles or turning crores of motorists into unwilling guinea pigs.

Venkatesh G