From Sea to Sky: The Blue Economy’s Role in the Global Energy Transition
- May 21
- 5 min read
May 21, 2025 - As nations intensify efforts to decarbonise their economies, the ocean is emerging not only as a climate stabiliser but as a critical engine of innovation in the global energy transition. Often overlooked in traditional renewable energy strategies, the Blue Economy — encompassing sustainable ocean-based industries — is gaining momentum as a source of clean power, low-carbon fuel, and carbon sequestration. Among the most promising developments is the use of marine algae to produce Sustainable Aviation Fuel (SAF), a solution that could reshape the future of flight.
Algal SAF: Clean Fuel from the Sea with a Long-Term Payoff
Algae-based SAF uses microalgae cultivated in saltwater or wastewater environments to produce oils that can be refined into jet fuel through processes such as hydroprocessing (HEFA) or transesterification. These algae naturally absorb CO₂ during growth, enabling the fuel production process to be carbon-neutral or even carbon-negative. Cultivation systems — whether open ponds or closed bioreactors — require no arable land, no freshwater, and can be integrated with carbon capture from industrial emitters or municipal wastewater, making them a compelling sustainable alternative to traditional oil crops.
Currently, algal SAF remains at the pilot to demonstration stage, with technology readiness levels at TRL 5–6. The cost of production ranges between $5–10 per litre, significantly higher than fossil jet fuel. Production volumes are minimal, representing less than 0.1% of the global SAF supply. However, advances in synthetic biology and reactor design are progressing rapidly.
Between 2026 and 2032, improvements in oil yield, contamination control, and modular bioreactor systems could reduce costs to $3–5 per litre, with commercial viability emerging in land-constrained, sun-rich regions like Australia, the Gulf, and coastal Asia. Potential early adopters include military aviation, high-cost island airports, and carbon-neutral aviation corridors. With the right policy and infrastructure support, algae-based SAF could represent 5–10% of global SAF capacity by 2040.
Importantly, algae-based SAF offers a compelling opportunity for high-emitting industries — particularly airlines, shipping companies, and industrial manufacturers — to integrate these fuels into their decarbonisation strategies and offset remaining emissions through carbon credits. Because algae absorb CO₂ during their growth cycle, qualifying SAF projects could be recognised under voluntary or compliance carbon markets, allowing producers and users to generate and trade carbon removal credits. For firms operating under tightening emissions regulations or ESG disclosure mandates, investing in or purchasing SAF from certified algae-based systems could offer both reputational and financial incentives.
Investors focused on climate impact, sovereign wealth funds, and aviation strategics are increasingly exploring partnerships in this space.
Beyond Algae: The Broader Ocean Energy Opportunity
The Blue Economy’s contribution to decarbonisation is not limited to algae. A wide array of ocean-based renewable technologies are now being explored and deployed, offering diverse pathways to meet global energy demands while reducing greenhouse gas emissions. Each comes with its own technical characteristics, maturity level, and geographic suitability — collectively forming a crucial part of the energy transition puzzle.
Offshore Wind Energy
Offshore wind is the most commercially mature and rapidly scaling form of marine renewable energy. Located at sea where wind speeds are generally higher and more consistent, offshore turbines are capable of producing vast amounts of electricity close to major coastal demand centres. Innovations such as floating wind platforms have recently enabled deployment in deeper waters, unlocking new geographies previously inaccessible to fixed-bottom turbines.
Europe leads globally in offshore wind capacity, with countries like the UK, Germany, and Denmark already integrating it into their base load. Despite higher upfront costs, offshore wind offers strong long-term returns due to high capacity factors and increasing policy support through auctions and feed-in tariffs.
Tidal and Wave Energy
Tidal and wave energy systems capture the kinetic and mechanical energy of ocean currents and surface waves, respectively. These forms of energy are highly predictable, offering consistent generation in contrast to intermittent wind or solar. Technologies include underwater tidal turbines, oscillating water columns, and point absorber buoys that convert wave motion into electricity.
The challenge lies in the engineering complexity of surviving harsh marine environments and delivering cost-competitive power. However, successful projects such as the MeyGen tidal array in Scotland and Eco Wave Power’s installations in Israel and Portugal demonstrate real progress. These technologies are particularly promising for island nations and coastal communities with strong tidal ranges or wave climates.
Ocean Thermal Energy Conversion (OTEC)
OTEC utilises the natural temperature gradient between warm surface waters and cold deep-sea waters to generate electricity through a Rankine cycle or ammonia-based heat exchange systems. The process can run 24/7, providing baseload power particularly suited to tropical and equatorial regions.
Although still in the demonstration phase due to low conversion efficiency and high infrastructure costs, OTEC offers multiple co-benefits. These include freshwater production through desalination, cooling applications, and integration with aquaculture. Nations such as Japan, India, and small Pacific Islands have tested or piloted OTEC systems, with further development dependent on public funding and international technology transfer.
Macroalgae for Bioenergy
Seaweed, or macroalgae, is also emerging as a bioenergy feedstock due to its fast growth, low resource requirements, and ability to absorb nutrients and carbon dioxide. It can be processed into biogas via anaerobic digestion, or fermented into bioethanol and other bio-based chemicals. Unlike land crops, seaweed farming does not require fertiliser or freshwater and can even remediate polluted waters.
Projects in Norway, South Korea, and Chile are piloting large-scale seaweed cultivation, both for energy and as a co-product for food, feed, and fertiliser. While energy applications are not yet cost-competitive, co-locating seaweed farming with aquaculture or offshore infrastructure may improve economics. It also presents a scalable solution for nutrient recycling and ocean restoration.
A Strategic Ocean Horizon
As energy markets evolve and decarbonisation becomes non-negotiable, the ocean offers a rare convergence of scale, sustainability, and strategic opportunity. The integration of algae-based SAF into global aviation supply chains — coupled with carbon credit generation and decentralised production — reflects the kind of innovation the energy transition demands. And as broader marine renewables mature, the Blue Economy could help balance energy security with environmental resilience.
While challenges remain — from capital intensity to regulatory complexity — the upside is vast. For forward-thinking investors, governments, and industry leaders, the next frontier in clean energy may not be on land or in the sky — but growing quietly beneath the surface of the sea.
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The information provided in this blog is for general informational and educational purposes only and should not be considered as financial, investment, or legal advice. While we strive to ensure accuracy and relevance, we make no representations or warranties, express or implied, regarding the completeness, reliability, or suitability of the information provided.