It turns out that algae as a fuel source actually has a history going back three decades to the Carter administration. In between the first and second oil shocks of the 1970s, the National Renewable Energy Laboratory began the Aquatic Species Program to research different species of algae that could be cultivated and harvested for producing fuels. As oil prices settled back down in the late 1980s, a lot of the work was scaled back but the data was still available for researchers. During the current decade, as the environment and the security of energy supplies became a greater concern, researchers have latched onto algae once again. Companies like Solazyme and International Energy are now working aggressively to commercialize algae biodiesel. Green Fuels Forecast has a great summary of the history of algae over the last three decades and where it stands today.
[Source: Green Fuels Forecast]