updated 9/10/2008 3:02:47 PM ET 2008-09-10T19:02:47

Now this could provide some truly green power.

Several Missouri universities and electric companies plan to use the carbon dioxide pollution from coal-fired power plants to grow green pond scum that could be turned into biofuel.

The project at the Central Electric Power Cooperative's plants east of Jefferson City is starting out small. Only a relatively little portion of its carbon dioxide emissions will be diverted from its flues and pumped into pools of sunlit water teeming with algae.

The bubbling gas is a rich food for the plants, which will be harvested as an alternative fuel. Algae oil can be processed into biodiesel, its carbohydrates used for ethanol and its proteins for livestock feed.

The potential benefits are twofold: a reduction in greenhouse gases and a homegrown fuel source.

Researchers at Lincoln University in Jefferson City already have been growing algae in labs while others at Missouri University of Science and Technology in Rolla have been experimenting with extracting biofuels from it.

Their agreement signed last Friday with Central Electric and its affiliate, Associated Electric Cooperative Inc., will put their experiment to a real-world test.

"It's aimed at trying to develop a product that may be commercially viable," said Don Shaw, Central Electric's chief executive officer.

The idea of using algae to produce biodiesel is not new.

From 1978 to 1996, the U.S. Department of Energy funded a program at the National Renewable Energy Laboratory in Golden, Colo., to develop renewable transportation fuels from algae.

Scientists at the Massachusetts Institute of Technology already have developed technology that feeds power-plant emissions to algae, which in turn is transformed into biofuel. A commercial spinoff, Cambridge, Mass.-based GreenFuel Technologies Corp., teamed with Arizona Public Service Co. last year to successfully grow algae at a natural gas power plant west of Phoenix.

In July, a consortium of companies in Hawaii announced plans to pipe carbon dioxide from a Maui Electric Co. plant into pools of nearby algae, which would be converted into biodiesel, animal feed and other products.

Also this year, scientists from the University of Kentucky sought to set up a carbon-dioxide-algae experiment at a power plant in western Kentucky.

Gale Buchanan, the U.S. Department of Agriculture's undersecretary for research, education and economics, praised algae fuel projects as holding great potential during a Friday ceremony announcing Missouri's plans.

"This issue is about the single biggest challenge our county faces — that is achieving sustainable energy security for our country," Buchanan said.

The two Missouri universities already have state and federal grants for their algae research. The new agreement calls for the electric companies to provide about $50,000 of infrastructure and other aid to set up and run the onsite experiment, said Nancy Southworth, a spokeswoman for Associated Electric Cooperative.

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