Upon hearing the word patent, your mind may leap to white haired inventors yelling “jumpin’ jigawatts” or tinkering with a better mousetrap. But patent law is serious business for high tech innovators trying to bring the most efficient renewable energy sources to a broad commercial market.  In the technology cycle, patents are often a harbinger of markets to come and judging by the number of worldwide patents filed, algal biofuels could be set to take off.

Gary Hamilton is a founding partner of Hamilton and Terrile, an Austin-based firm that operates in all facets of intellectual property law. He says clean tech innovations, like most research and development, have a critical reliance on patents. “It is very unlikely that any clean tech company will be able to receive venture capital from investors without the assurance that there is a very high probability that the technology will provide them exclusive rights in the marketplace,” he says. 

This assurance is being sought in record numbers that even the global recession hasn’t been able to batter, thanks to third generation biofuels. According to Thomson Reuters, in 2008 biofuel-related patents increased 550 percent over the number issued for the same industry in 2003. The innovations show no sign of slowing and by the first quarter of 2009 more biofuel patents had been filed than the entire previous year. These sort of numbers put biofuels among the top three industries for patent filing worldwide.

Within that exploding industry group of patents – algae patents are growing at a particularly noticeable rate. From January to December of 2003 there were only three patents for algae biofules filed in the world. By March 2009 there were 92. The United States is managing to lead in this niche and currently has the most companies filing algae patents – with eight of the top 11 patent holding companies. Brazil, the United Kingdom and France each have a single company.
While numerous patents indicate a high level of research and development into a technology, Hamilton says a slew of patents are no guarantee of an industry’s success. “The likelihood of the industry sector succeeding may be influenced by a high level of patent protection,” he says, “however, the sector is also susceptible to many other economic factors.” 

If a fundamental technologic component is patented, Hamilton says “for the company with a patent on an improvement to obtain a license from other companies to use the original underlying technology.” For example, the technology firm OrginOil recently signed a cross-license agreement with Desmet Ballestra to partner up on it’s patented process of extracting oil from algae, using a significantly less expensive method. They also have a cross-license agreement with the Department of Energy at the Idaho National Laboratory to develop their concepts into a larger scale. 
The Carnegie Council’s Global Policy Innovations program recently released a report that worries, “concerns have been expressed that restrictive licensing and broad patent claims could stymie technological development in this field.” Hamilton disagrees, “I do not believe that patent laws or policies are more restrictive for developing clean technologies.  Perhaps, the opposite is true.” Keeping an eye on the burgeoning algae fuels sector should provide some lessons on how well the technology can be brought to market.