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An Investigation Of Development Pathways For An Economically

Viable Seafarm Cultivation At The Kosterfjorden, Sweden

Jean-Baptiste Thomas

Master of Science Thesis

Stockholm 2013

Jean-Baptiste Thomas

Master of Science Thesis STOCKHOLM 2013

An Investigation Of Development Pathways

For An Economically Viable Seafarm

Cultivation At The Kosterfjorden,

Sweden

PRESENTED AT

INDUSTRIAL ECOLOGY ROYAL INSTITUTE OF TECHNOLOGY

Supervisor:

Fredrik Gröndahl, Industrial Ecology, KTH

Examiner:

Fredrik Gröndahl, Industrial Ecology, KTH

TRITA-IM 2013:30

Industrial Ecology,

Royal Institute of Technology

www.ima.kth.se

Abstract New opportunities for sustainable economic development have emerged from the

transdisciplinary collaboration of aquaculture and biotechnology. As a response to the

European Commission’s call for a European Bioeconomy, SEAFARM, a five-‐year program

pending funding from FORMAS, aims to develop a sustainable aquaculture as a milieu for

and in support of further research in blue biotechnology in five collaborating institutions in

Sweden. This thesis aims to explore aquaculture technologies, notably IMTA and long-‐line

systems, established and emerging seaweed-‐based products, the proposed Kosterfjorden

site, a case study of a similar project in Scotland, BioMara, and some other technological and

socio-‐economic hurdles that will affect the SEAFARM cultivation -‐ all to enable the

development of two economically viable but contrasting scenarios for the cultivation.

Scenario ONE represents a BioMara inspired cultivation optimised for the industrial

production of biofuel feedstock, while scenario TWO explores the potential of a small-‐scale

and diverse IMTA cultivation. These scenarios were cross-‐referenced against the scenario

context criteria. The final result indicated scenario TWO, the small-‐scale diversified IMTA,

would be a more adaptable and economically resilient option, delivering a greater variety of

species for biotechnological scrutiny, potential for a diverse and specialised range of

products and revenues, while also optimising the conditions necessary for the pursuit of

SEAFARM research objectives, notably through the development of the first IMTA in

Sweden.

Acknowledgements At the time of writing this acknowledgement only a few days have passed since my

supervisor, Fredrik Gröndahl, was awarded funding to initiate the SEAFARM research

project. I would like to congratulate him as well as thank him for giving me the opportunity

to witness the beginning of a great landmark research initiative for Sweden. Just like in the

course of any journey, one meets people who give up a bit of their time to help you along

the way with new ideas, motivating stories, guidance, support and friendship. My deepest

gratitude goes out to all the interviewees, notably Göran Nylund and Stephen Cross, Fredrik

and his wife for their hospitality, as well as Karin Orve and Monika Olsson for their passion

and dedication to our course. This thesis would not have been possible without the

enterprising and enduring friendships of my fellow masters graduates. I would also like to

thank my family and all my friends back home without whose support, I would have never

gone to KTH in the first place.

Jean-‐Baptiste Thomas

List of Abbreviations SLCMS Sven Lovén Centre for Marine Sciences SMHI Swedish Meteorological and Hydrological Institute IMTA Integrated Multi-‐Trophic Aquaculture SAMS Scottish Association for Marine Sciences BESP Break-‐even Electricity Selling Price AD Anaerobic Digestion PP Profit Potential RSI Required Seaweed Input FA Focus Area

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List of Figures, Tables and Charts Figure 1 A holistic perspective diagram of SEAFARM FAs 1-‐5 Figure 2 Market shares of global seaweed industry by product in 2004 (US$

Millions). Figure 3 Pyramid of trophic levels for a marine environment. Figure 4 Diagram illustrating an IMTA, featuring finfish, shellfish, seaweeds and

invertebrates. Figure 5 Value pyramid for algae-‐based products.

-‐ -‐ -‐ -‐ -‐

Table 1 Main components of the world's seaweed industry and their value for 2004 (US$).

Table 2 Description and approximate values of typical algae-‐based foods. Table 3 Description and approximate values of typical phyco-‐supplements. Table 4 Statistiska centralbyrån energy prices for natural gas and electricity

(SEK/MWh). Table 5 Summary of market status and qualitatively assigned PP and RSI, by

product category. Table 6 Summary of results.

-‐ -‐ -‐ -‐ -‐

Chart 1 Seasonal Fluctuations of Surface Water Temperature Gradients (°C) at

the Kosterfjorden in 2012. Chart 2 Seasonal Fluctuations of Surface Water Salinity Gradients (PSU) at the

Kosterfjorden in 2012. Chart 3 Seasonal Fluctuations of Nitrate (mgL-‐1 ) and Ammonium (mgL-‐1 )

Gradients at the Kosterfjorden in 2012. Chart 4 Seasonal Fluctuations of Nitrite (mgL-‐1) and Phosphate (mgL-‐1)

Gradients at the Kosterfjorden in 2012.

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1. INTRODUCTION .......................................................................................................... 5 1.1. BACKGROUND: THE BIOBASED ECONOMY .................................................................................................... 5 1.2. SEAFARM ............................................................................................................................................................. 6 1.3. AIMS AND RESEARCH QUESTION .................................................................................................................... 8 1.4. OBJECTIVES ......................................................................................................................................................... 9

2. METHODOLOGY ....................................................................................................... 11 2.1. GROUNDED THEORY ....................................................................................................................................... 11 2.2. METHODOLOGY ................................................................................................................................................ 13 2.3. LIMITATIONS .................................................................................................................................................... 16 2.4. ETHICAL ASPECTS ........................................................................................................................................... 17

3. LITERATURE ............................................................................................................ 19 3.1. MACROALGAE ................................................................................................................................................... 19 3.1.1. Biological basics ...................................................................................................................................... 19 3.1.2. Seaweed: a global industry ................................................................................................................. 22 3.1.3. Phyco-‐products and their value ........................................................................................................ 24

3.2. AQUACULTURE ................................................................................................................................................. 34 3.2.1. Fish aquaculture ...................................................................................................................................... 35 3.2.2. Seaweed aquaculture ............................................................................................................................ 37

3.3. IMTA: INTEGRATED MULTI-‐TROPHIC AQUACULTURE ........................................................................... 38 3.3.1. Defining IMTA ........................................................................................................................................... 39 3.3.2. Ancient Origins ......................................................................................................................................... 42 3.3.3. Quantifying IMTA Synergies ............................................................................................................... 44

4. CASE STUDY: BIOMARA ............................................................................................ 48 4.1. KEY FINDINGS .................................................................................................................................................. 49 4.1.1. Identifying Seaweeds for Biofuel Conversion .............................................................................. 49 4.1.2. Harvesting Beach-‐Cast Seaweeds .................................................................................................... 50 4.1.3. Technological and Socio-‐Economic Impacts of Biofuel Production from Marine Biomass ........................................................................................................................................................................ 51

4.2. PROJECT SETBACKS ......................................................................................................................................... 52 4.3. ‘PASSING THE BATON’ TO SEAFARM ......................................................................................................... 53

5. RESULTS: SEAFARM DEVELOPMENT SCENARIOS ............................................................ 55 5.1. SCENARIO CONTEXT ........................................................................................................................................ 55 5.1.1. The Kosterfjorden site ........................................................................................................................... 56 5.1.2. Assigning values to products .............................................................................................................. 61 5.1.3. SEAFARM research objectives ............................................................................................................ 64 5.1.4. Socio-‐ and techno-‐economic context .............................................................................................. 66

5.2. SCENARIO DESIGN ........................................................................................................................................... 68 5.2.1. Scenario ONE – A Biofuel Optimised Aquaculture .................................................................... 68 5.2.2. Scenario TWO – A Small-‐Scale Diversified IMTA ...................................................................... 70

5.3. SCENARIO MATRIX RESULTS ......................................................................................................................... 72 6. CONCLUSION .......................................................................................................... 74 6.1. FURTHER RESEARCH ....................................................................................................................................... 75

7. REFERENCES ........................................................................................................... 77

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8. APPENDIXES ........................................................................................................... 86 8.1. APPENDIX A – VARIABLES AFFECTING SEAWEED GROWTH RATES ........................................................ 86 8.2. APPENDIX B – QUANTIFYING IMTA SYNERGIES (FULL) ....................................................................... 87 8.3. APPENDIX C – MAPS OF KOSTERFJORDEN SITE FOR SCENARIOS ONE AND TWO ............................. 94 8.4. APPENDIX D – MAP OF AREA, PHOTOGRAPHED DURING STUDY VISIT TO SLCMS ............................. 95 8.5. APPENDIX E – INTERVIEW TRANSCRIPTS ................................................................................................... 96

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1. INTRODUCTION

The present thesis was written in support of the pending SEAFARM project. The

introduction presents the call by the European Commission for research to pave the

transition to an inherently sustainable bioeconomy. SEAFARM is the embodiment of

a Swedish response to this call. The core aim of the thesis will thereafter be

introduced, and objectives to achieve this goal will be fractioned out.

1.1. BACKGROUND: THE BIOBASED ECONOMY

“For most people, the bioeconomy is the way of the future. A shift towards an

economy based on renewable resources not on fossil fuels is no longer just an

option, it's a necessity” (European Commission, 2012).

The above quote summarises the basics quite accurately. The sooner the

replacement of fossil fuels is conquered in theory and practise, the better. In the

race to develop a European bioeconomy, the European Commission launched in

February 2012 a new strategy entitled “Innovating for Sustainable Growth: a

Bioeconomy for Europe” (European Commission, 2012). Summarised by Maive Rute

Director of the European Commission ‘Biotechnology, Agriculture and Food’

Directorate, the vision is for a “transition to a more resource efficient society that

relies more strongly on renewable biological resources to satisfy consumers' needs,

industry demand and tackle climate change” (Rute, 2012).

In Europe the bioeconomy is already one of the major industries, turning over an

estimated €2 trillion and accounting for 9% of jobs, employing over 22 million

people principally in fishing, forestry and farming (Rute, 2012). These are the three

primary production sectors that will feed the bioeconomy, whose products will be

processed in biorefineries to replace fossil fuel-‐based products.

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Both farming and forestry are well established in the EU, protected by strong

regulation and scrutinised by independent judicators -‐ however the domain of

fishing is very different. Perhaps it is because the oceans are too vast to grasp the

impacts we are having on them, or perhaps, as terrestrial mammals, we do not

relate the aquatic happenings in the same way as we do on-‐land. The human

conquest of the oceans is still in its infancy and predominantly based on what you

might term primitive ‘hunter-‐gatherer’ principles, to harvest natural stocks. Most

ocean-‐based produce comes either directly (wild capture fisheries) or indirectly

(intensive aquaculture fed with wild capture fish) from natural stocks, which are

dwindling at alarming rates in the face of improved technologies and growing

demand. Only a minority of the overall market is based on ‘agricultural’ principles,

whereby a carrying capacity is increased by intensive species cultivation, lessening

pressure on natural stocks. Until the second half of the 20th century, few cultivations

of aquatic products took place, however incentives and demand are on the rise, and

policy makers are increasingly looking to our oceans for answers.

1.2. SEAFARM

The SEAFARM project aims to provide Sweden with its first sustainable macroalgae

farm to provide an entirely new class of feedstock, marine-‐based feedstock, for a

future biobased Swedish economy (Gröndahl, 2012). The project is still in its infancy

having applied for funding in early 2013. A location for the farm remains to be

determined, but it will need to be located in proximity to the Sven Lovén Centre for

Marine Sciences (SLCMS), Tjärnö. The SLCMS is a research centre internationally

renown for its marine science excellence and innovation, able to provide the

expertise, equipment and facilities needed to cater for such a research project.

The SEAFARM project extends beyond a mere seaweed cultivation however: a

transdisciplinary research collaboration will be formed between some of the major

academic institutions in Sweden, including KTH Stockholm, Linnaeus University,

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Lund University, the University of Goteborg and Chalmers. SEAFARM is separated

into five focus areas (FA) as seen in figure 1 below.

Figure 1 – A holistic perspective diagram of SEAFARM FAs 1-‐5. Source: Gröndahl (2013)

FA1 involves the stimulation of know-‐how about sustainable seaweed cultivation on

the Swedish west coast. FA2 will be an investigation to develop cheap and effective

post-‐harvest pre-‐treatment and preservation methods for subsequent transport. In

FA3, seaweed biomass shall be subjected to thorough biotechnological scrutiny,

mapping out its constituent elements, identifying potential products and developing

a biorefinery approach for their extraction, similar to the multi-‐product fractioning

in petroleum refineries. FA4 aims to optimise the biofertiliser and biogas potential

of wastes coming from the biorefinery fractioning processes. Finally FA5 will see the

design and implementation of new holistic sustainability assessment tools,

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developed specifically in the context of cultivation and refining of seaweed biomass.

(Gröndahl, 2013)

Having received some preliminary funding for pilot projects, SEAFARM seems likely

to be granted funding for a period of up to 5 years. However it would be

counterproductive for the community of Swedish marine biotechnologists, if after

this five-‐year period, such an aquaculture were to become unviable and redundant.

For the cultivation to continue independently in the future and persist in providing a

suitable environment for further research, it should reach a state of economic

sustainability by the end of the five years. With this in mind, the present thesis

should be read as a preliminary investigation into development pathways to

economic viability for SEAFARM.

1.3. AIMS AND RESEARCH QUESTION

Like any research project, this thesis represents a journey. It began with the aim of

determining the scale of operations required for economies of scale to push a

macroalgae farm producing for biofuel feedstock, toward a state of economic

viability. In essence, the core of the project would have involved building on the

legacy of the SAMS BioMara project and its transposition to a Swedish west coast

context. As the literature review process began to reveal itself, it became apparent

that research in the field had rapidly matured. The last few years has seen a rapid

rise in publication and patents relating to marine organisms (Submariner

2012:148). Whereas only a few years ago research focused on developing marine

resources as biofuel feedstocks, today that is only a small part of an emerging bigger

picture – that all sorts of compounds and chemicals can be fractioned out of

macroalgae, not just biofuels.

Only in this context does the full extent of the SEAFARM research project become

apparent: it is acting as a catalyst for the transdisciplinary collaboration of marine

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aquaculture, blue biotechnology and biofuel research in Sweden. The economic

viability of such a cultivation and its downstream operations is undoubtedly vital, to

support research beyond the restricted five-‐year funding package, for what could be

the emergence of an entire new industry on the west coast of Sweden.

As a result of this preliminary exploration the present thesis took on a new

direction: to inform and enable SEAFARM strategizing and decision-‐making. Can a

sustainable macroalgae cultivation on the Swedish west coast provide high quality

samples for SEAFARM research, while achieving economic viability within five

years? This shall be considered the research question to which this thesis embodies

an answer.

1.4. OBJECTIVES

In order to achieve this rather broad aim, a series of objectives were identified as

stepping-‐stones to painting the full picture. These are bulleted hereafter and

provide a generalised sequence that was followed.

ü Select a cultivation site near SLCMS & establish background information

ü Explore the seaweed & fish aquaculture industries: current trends and challenges,

best practises and current research focus areas.

ü Identify potential phyco-‐products & revenues

ü BioMara Case Study (2009-‐2012): research project coordinated by SAMS with a focus

on cultivation of seaweed as biofuel feedstocks.

ü Develop and analyse alternative scenarios for the development of an economically

viable cultivation for SEAFARM

i. Establish a representative scenario context including: end products, conditions at the site,

SEAFARM objectives and other techo-‐ and socio-‐economic considerations.

ii. Define two contrasting scenarios: a biofuel optimised aquaculture inspired from BioMara;

and a small-‐scale diversified IMTA.

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iii. Analyse their performance with regard to the criteria established in the scenario context.

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2. METHODOLOGY

Such a broad field of research and multivariate scenario context required an

intricately tailored combination of methodologies, to provide up to date and

accurate information, adaptable to constantly new and emerging publications. A

combined quantitative and qualitative approach was used, with a distinct partiality

to qualitative research methods. This chapter begins by explaining the general

approach and timeline of the research process. Thereafter the methodological core

of the research is presented and justified.

2.1. GROUNDED THEORY

Before going into the details of the methodological treatment and acquisition of data

or information, the general flow of the thesis must be motivated. The handling of the

broad palette of overlapping disciplines required a timeline and approach inspired

from elements of Grounded Theory (Glaser and Strauss, 1967); namely to intertwine

different methods and uncover development pathways simultaneously to the

research being carried out (Becker and Bryman, 2004:268). Some significant

shortcomings in data collection and in the research processes led to U-‐turns and

twists in the research flow, which are hereafter explained.

As already introduced in the section aims and research question, the original aim of

the thesis changed radically when it became apparent that blue biotechnology had

emerged as a major player in the development of marine resources. Until then, the

thesis aimed to explore the prerequisites for a BioMara inspired, economically

viable, biofuel feedstock cultivation. Thereafter it evolved into a comparison of

development scenario: one, BioMara inspired cultivation for the supply of marine

biofuel feedstock; and two, a smaller-‐scale diversified cultivation. This is typical of

how grounded theory impacted the research process.

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The SEAFARM objective, to develop a sustainable aquaculture led the author to

question what this might be. What forms of sustainable aquaculture exist today? In

the course of the literature review it became apparent that mono-‐trophic

aquaculture of marine animals or plants is fundamentally unsustainable when

considered from a holistic systems perspective, either due to high levels of

environmental stress, or from lack of profitability. A meticulously designed

combination however enables them not only to cancel out some of each-‐others

respective flaws, but can also add to productivity and resilience (Chopin, 2006).

Thus IMTA emerged as a technique with great promise, designed for environmental

neutrality, optimised productivity and a having more diverse range of produce than

any other known cultivation technique. Rather than mirroring industrial agriculture

by establishing single or dual crop cultivation or crop rotations, an IMTA approach

is characterised by a protracted design process for a balanced, resiliently productive

and environmentally neutral engineered ecosystem. The IMTA approach is currently

a hot topic in research given the potential to mitigate finfish aquaculture pollution

by upgrading to a calculated multi-‐trophic approach (Chopin et al., 2011; Neori and

Nobre, 2012; Diana et al., 2013). After these considerations IMTA became an

integral part of the second scenario as it was considered to be the best-‐suited

practice matching the initial SEAFARM objective, to develop a sustainable

aquaculture.

A final significant twist in the methodology came about as a result of a suggestion

offered during the study visit to the SLCMS, whereby SMHI water sample data was

available for potentially suitable cultivation site along the edge of the Kosterfjorden.

Initially it was hoped that the BioMara case study would provide data regarding

seaweed growth rates and water quality samples, enabling a comparison of water

quality with SMHI’s Kosterfjorden data, therefrom extrapolating growth rates and

yields to inform the question of scale. Thus BioMara researchers were interviewed

(see section 2.2) and it transpired that during the BioMara project very little

cultivation data was acquired due to marine licensing issues. Furthermore,

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complications relating to funding meant that any data on water samples were not

sharable. The grounded theory twist thereafter enabled the SMHI water quality data

in the Kosterfjorden area to be used nonetheless: the data was plotted on graphs

enabling it to be interpreted by interviewees during interviews, and to obtain an

insight into key challenges than may emerge during seasonal fluctuations of water

conditions. Yet again, the grounded theory inspired approach to the research

provided the tools to maintain initiative and flexibility in research orientation; and

to consider all methodological phases as a single learning process.

2.2. METHODOLOGY

A combination of quantitative and qualitative methods can provide a clarity and

breadth of scope to answers that one alone will usually fail to achieve (Silverman,

2005), thus it was decided to use both where possible. However given the state of

the SEAFARM project, its pending status and early planning circumstance, very little

quantitative data is available leading to a significant partiality to qualitative

techniques. Hereafter the research procedure is elaborated.

At the beginning of the project, the thesis supervisor [Fredrik Gröndahl] suggested a

field visit to the SLCMS, Tjärnö. The encounter with one of the potential research

sites and teams provided an insight into the untapped potential of the cultivation

and in proximity to this extensive marine research facility, as well as to kindle

personal motivation fuelled by the enthusiasm of the resident researchers. An initial

focus group –styled discussion was held with Göran Nylund and Fredrik Gröndahl at

the SLCMS, to identify project limitations and highlight specific avenues of interest.

In the wake of this study visit, the data collection process was planned in four

distinct phases: the initial literature review, the BioMara case study, the semi-‐

structured interview process and finally, the scenario methodology.

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A majority of the information in this thesis was collected by literature review. This

was the primary and most lengthy phase of the research process. Key areas that

were reviewed included: biology of macroalgae, notably factors that affect growth

rates (Appendix A); phyco-‐products and their value; the global aquaculture industry

for fish and seaweed; and IMTA, its emergence and role in the future of the

aquaculture industry, and an evaluation of IMTA synergies (Appendix B).

Five Semi-‐structured interviews were another key part of the thesis methodology,

and were specifically selected to enable conversations to flow freely, within a set of

predefined guiding questions and themes. In accordance with ethical

methodological procedures, all interviewees were given the option to be kept

anonymous. Furthermore, prior to the interviews they were asked for consent to be

recorded. None kept their right to anonymity and none refused to be recorded.

Transcripts are attached (Appendix E).

Information to compile the BioMara case study was gathered from literature,

particularly the key BioMara findings, but also by interviewing the BioMara project

coordinator, Dr Michele Stanley, as well as a seaweed cultivation expert working in

close collaboration with Dr Stanley during the BioMara project, Lars Brunner. These

interviews gave an insider’s intuition of the successes and failures of BioMara, most

notably elements that are not covered in literature such as practical limitations and

setbacks of the project.

Further semi-‐structured interviews were conducted. One of these was with Per

Rehnlund of Leroy AB, a food processing company with specific interest in the

development of marine foods and sea vegetables in Scandinavia. This interview was

structured to yield some information on potential value of harvested algae and the

state of the Scandinavian market for sea vegetables, and other algae-‐based foods

and products, notably phyco-‐supplements and phycocolloids.

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Finally and in support of the IMTA section, interviews were conducted with Dr Greg

Reid from the University of New Brunswick, and Stephen Cross, associate professor

in IMTA research at the Aquaculture Institute of the University of Stirling and

industrial research chairman for the Natural Sciences and Engineering Research

Council of Canada. These interviews shed light on the very latest advances in IMTA

research and the industrial applications of IMTA.

The tailored scenario methodology was then developed with two significant parts:

the first was to set a scenario context, the second to describe each scenario and

discuss how they fit into the scenario context. The scenario context was established

in four parts.

Part 1 involved the collection of data from SMHI regarding the hydrology of the

Kosterfjorden site, an area in immediate vicinity to the SLCMS. The data from these

water samples were plotted on graphs to examine potential growth conditions for

seaweed in the area. The graphs were sent to interviewees and discussed in

particular depth with Lars Brunner, Stephen Cross and Greg Reid, each of whom

interpreted them and made suggestions about growth conditions and potential

problems that may be encountered at the site. Part 2 of the scenario context aimed

to set out a framework to interpret the relative value of a selection of product

categories: phyco-‐supplements, food and sea vegetables, phycocolloids and biogas.

Most of this information was gathered from literature, but some significant

contributions also emerged from interviews. Furthermore, the estimation of prices

for the different phyco-‐products was opted for to illustrate and provide a guiding

idea of these products values, and as such, many of the values were found by

searching the internet, notably from the major online retailers such as Amazon. The

interview with Per Rehnlund of Leroy AB also helped to reinforce these findings.

Part 3 established some criteria for the analysis of each scenario’s performance in

the delivery of the SEAFARM research focus areas (FA1-‐5). This was also based on

literature reviewing, or more specifically, Gröndahl (2013). Finally, Part 4 brought

in some considerations of other socio-‐ and techno-‐economic aspects that could

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influence the development of the cultivation, also based on literature and

interviews.

Having established the scenario context, the scenarios themselves required defining

for comparative analysis in the scenario context. This analysis was supported by the

interviews, particularly for considerations of environmental growth conditions

(Stephen Cross, Lars Brunner and Greg Reid), product values and markets (Per

Rehnlund) and finally, the cultivation’s economic viability (Michele Stanley). This

was the second major element of the scenario methodology, consisting of pragmatic

consideration of each scenario in terms of: the scale and type of cultivation, required

infrastructure, labour, deliverable products, licensing issues, public acceptability,

and economic resilience. Google maps were modified to help visualise each scenario

(Appendix C) and a detailed local map was photographed during the study visit for

further reference (Appendix D). The results from the comparative analysis were

summarised in a table (Table 6) to enable the drawing of conclusions.

2.3. LIMITATIONS

To facilitate the research process, a predefined set of limitations was established. In

terms of the geography of the research, it is limited to consider the Kosterfjorden

pilot facility and surrounding areas that are being considered as a part of an

eventual commercial expansion. Notably the Kosterfjorden site was selected, as it

was the only place in near the SLCMS with SMHI water quality data. Incidentally, it is

also perhaps the Swedish territorial water with the highest salinity content, thus

favouring elevated seaweed growth rates (Submariner, 2012).

Value is a difficult term to consider in research these days, given that it is so

subjective and multifaceted (Costanza et al., 1997). Neither the value of ecosystem

services performed by seaweeds nor ‘carbon-‐credit’ inspired revenues from

nutrient stripping were considered in the scenario method. Furthermore, costs were

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difficult to estimate for SEAFARM, given how early this thesis was written relative to

the project commencing. It was hoped that a quantified supply chain with flow

volumes, costs and revenues could be developed, but a lack of data made this

unachievable. Thus costs are not estimated within this project but they are

considered when available from peer-‐reviewed data, in which case they were

brought in to the literature review.

Two other significant limitations to the project were the restriction of the scope to

biogas production only, thus disregarding bioethanol and biodiesel production, as

well as the simplified representation of phyco-‐products into three product

categories (excluding biogas). The considerable variability across these categories

led to complications in the interpretation of results. For instance, the phyco-‐

supplements category has low value high volume products such as soil additives,

but it also includes their polar opposite, high value low volume pharmaceutics. On

the one hand this reflects the reality of the wide range of products that can be

extracted from seaweeds, however this somewhat sacrifices the ability to accurately

analyse and estimate potential revenues of the second scenario. Finally, the

restriction to biogas was simply that the current technologies for the extraction of

bioethanol and biodiesel from algae are widely considered as not being a break-‐

even technology yet. In the coming years, these technologies will also become

worthy subjects for an economic viability assessment of extraction from marine

feedstocks.

2.4. ETHICAL ASPECTS

The nature of the project, that it is an economic viability assessment of two fictional

scenarios, meant that there was very little contact with real ‘people’ other than

interviewees and so very few ethical aspects to consider within the research

process. The SEAFARM research team will necessarily have to undertake some

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public awareness meeting for local inhabitants prior to the application of a marine

license, however this is far beyond the scope of this thesis.

Exterior considerations as to the wider implications of sustainable aquaculture can

and should be mentioned. It is important to note that very little research has been

undertaken to investigate the impacts of seaweed cultivations and IMTAs on marine

wildlife, considered subjects of ethics. It could also perhaps be argued that, morally

speaking, it is vital that further research be undertaken in IMTA to support political

discourse to develop directorates on the upgrading of aquaculture operations to

reduce their environmental impacts through multi-‐trophic integration.

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3. LITERATURE

3.1. MACROALGAE

The following section will first present some biological basics on seaweeds,

highlighting the reasons why they are subject of growing interest amongst

researchers. Thereafter the existing global seaweed industry will briefly be outlined,

followed by a detailed account of four major product categories that can be derived

from seaweeds – food, phycocolloids, phyco-‐supplements and biofuels. These

categories are based on the distinctions made by Chopin and Sawhney (2009) to

support and enable the subsequent section on scenario development.

3.1.1. Biological basics

Algae are amongst the earliest life forms that known on the planet, evolving from

primitive cyanobacteria at least 1 billion years ago. It is thought that the

evolutionary path taken by algae has allowed for a far greater physiological

diversity than exists amongst terrestrial plants, particularly in reference to the

variety of proteins and carbohydrates found in cell walls, many of which are unique

to individual species making them particularly valuable in biotechnology

(Domozych et al., 1980). A key divergence took place along this evolutionary

journey quite early on, allowing taxonomists to distinguish species by colour of their

respective constituent photosynthetic pigments: Rhodophyta, red algae;

Chlorophyta, green algae; and Phaeophyta, brown algae (Roesijadi et al., 2010).

Perhaps more significantly, single cells began to congregate and from complex

macro-‐structures around 600million years ago (Yuan et al., 2011), thus

differentiating themselves as macroalgae – the focus of this report.

Seaweeds have colonised almost all illuminated aquatic habitats on the planet,

adapting to local conditions and demonstrating impressive resilience (Domozych et

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al., 1980). There are essential metabolic requirements for each species, for instance

some seaweeds require saline environments, or prefer to be located in the intertidal

zone. In the Baltic Sea and Swedish west coast, species have adapted over

generations to particularly cold and brackish conditions. As such it can be expected

that specimens of Laminaria digitata or Saccharina latissima collected from these

waters will be very different to corresponding specimens collected in Scotland,

Spain or Canada -‐ yet some distinctive physiological and reproductive traits are

shared by most. (Naoki et al., 2006)

Most macroalgae are characterised by a ‘holdfast’ or foot acting as an anchor; a

‘stipe’ or stem which structurally, like the trunk of a tree, links roots to leaf; and a

single or multiple ‘blades’ where most of the photosynthetic activity takes place.

With regards to reproduction, most seaweeds display what is known as a haploid-‐

diploid life cycle as is common in some terrestrial ferns and fungi. The ploidy refers

to the number of chromosomes present in that stage of the life cycle, haploids

having a single set of chromosomes in the cellular nucleus while diploids have two,

in other words a full set (Dawson, 1966). Thus to reproduce, the spermatophyte

diploid adults undergo meiosis to produce haploid spores which, given time,

develop into male and female gametophytes. When mature, the gametophytes

produce eggs and sperm, which form young spermatophytes upon contact,

completing the life cycle (Lewis, 1964).

The swelling interest in macroalgae stems from a large variety of adaptations these

plants are known to possess -‐ their ability to thrive in low temperatures and low

light conditions, their biofiltration properties and high energy content, to name a

few -‐ particularly when compared to terrestrial counterparts. For instance,

photosynthetic efficiency of terrestrial plants varies around 1.8 to 2.2%, whereas

that of aquatic plants usually ranges from 6 to 8% (Aresta et al., 2005), providing

macroalgae with the fastest growth rates of any plant. Additionally seaweeds absorb

nutrients such as nitrogen and phosphorus, chronic pollutants of the Baltic Sea,

consequently offering a pathway for environmental engineering (Fox and Chapman,

21

2011; Marshall, 2012) or decontamination of current industrial activities, such as

finfish aquaculture (Huo et al., 2012).

The distribution of algal species in the Baltic Sea reflects the environmental

limitations to algal growth. It is accepted that the most important abiotic factor

controlling algal diversity in the Baltic Sea is salinity (Blidberg and Gröndahl, 2012),

however growth rates are determined by a plethora of environmental factors

ranging from light and nutrient availability to temperature, water motion and

turbidity (Lewis 1964). In order to maximise the yield of harvestable macroalgae, it

is crucial to understand the biological relevance of these variations in all their

aspects. For an explanation of the effects of such environmental factors on growth

rates, see APPENDIX A.

Many of the factors in APPENDIX A have already been considered for site selection

at Tjärnö, particularly salinity, given its biological importance and the brackish

environment that is the Baltic Sea. The SLCMS is located in a sheltered bay on the far

north of the Swedish West coast, where the water is of the highest salinity of any

Swedish waters, favouring growth conditions for algae. However the site was also

selected because of the existence of the SLCMS, a year-‐round marine research centre

with a collection of wet laboratories, equipment and scientists, whose expertise and

knowledge of the area will undoubtedly help to accelerate the development process

of SEAFARM. Specifically within the context of this thesis, the Kosterfjorden area

was selected as the site of the cultivation, constrained by the availability of water

quality sample data from SMHI.

Having covered some of the biological basics of seaweeds, the following section will

move to examine the economic potential of seaweeds, and clarify how the value of

seaweeds has been re-‐interpreted in the last few decades.

22

3.1.2. Seaweed: a global industry

The value of the global seaweed market is estimated at US$ 5.5-‐6 billion per annum

by the FAO (2003), most of which is generated from direct human consumption in

the form of food. Approximately US$ 1billion is generated from a combination of

high value products destined for the cosmetics, pharmaceutics and food processing

industries (FAO, 2003), with the remained from miscellaneous activities such as soil

conditioners, fertilisers and animal feed additives (FAO, 2004). The raw material

input to this global industry, ie. the annually harvested wet mass, is estimated as

being approximately 7.5-‐8 million tonnes (FAO, 2004), most of which is cultivated

and a minority is harvested from natural stocks. A basic calculation from these

figures indicates that the global average value of all seaweeds lies in the region of

US$ 0.65-‐0.8 per kilogram of wet mass -‐ but in reality there is a great variation in

price according to species and location of production. Table 1 below provides a

detailed breakdown of the major industry components and their market values.

Figure 2 below helps to highlight the importance of these three major sectors of

production by showing each industry component’s share of the global market. Both

table and figure present information from Chopin and Sawhney (2009).

Table 1 -‐ Main components of the world's seaweed industry and their value for 2004

(US$). Source: Chopin and Sawhney (2009)

Industry Component Raw Material (wet tonnes)

Products (tonnes) Value (US$)

Sea-‐vegetables TOTAL 8.59 million 1.42 million 5.29 billion Kombu (Laminaria) 4.52 million 1.08 million 2.75 billion Nori (Porphyra) 1.40 million 141 556 1.34 billion Wakame (Undaria) 2.52 million 166 320 1.02 billion

Phycocolloids TOTAL 1.26 million 70 630 650 million Carrageenans 528 000 33 000 300 million Alginates 600 000 30 000 213 million Agars 127 167 7 630 137 million

Phyco-‐supplements TOTAL 1.22 million 242 600 53 million Soil additives 1.10 million 220 000 30 million

23

Agrichemicals (fertilisers, bio-‐stimulants)

20 000 2 000 10 million

Animal feeds (supplements, ingredients)

100 000 20 000 10 million

High value miscellaneous (Pharmaceuticals, nutraceuticals, botanicals, cosmeceuticals, pigments, bioactive compounds, antiviral agents, brewing, etc.)

3 000 600 3 million

Figure 2 -‐ Market shares of global seaweed industry by product in 2004 (US$

Millions). Source: Chopin and Sawhney (2009)

Human beings have been consuming seaweeds for millennia. A growing demand has

sparked a rapid increase in cultivation capacity over the last half century,

particularly in Asia, where it is a dietary staple. The share of the global market held

by sea vegetables such as Kombu, Nori and Wakame is astounding: almost 90% of

the seaweed industry comes from the demand of these three edible species, as

illustrated in Figure 2 above. A market analysis conducted by Walsh and Watson

24

(2012) for the BMI (Irish Sea Fisheries Board) explored the potential of all seaweed-‐

based products in a European context. This extensive report concluded that the

demand for edible seaweeds is present though minimal, however there is

substantial room for growth in the seaweed industry to meet a growing demand for

high value phycocolloids and especially for phyco-‐supplement products.

It is increasingly being recognised at a global level that the value of seaweeds is not

just of economic relevance. In their natural environment, seaweeds truly are

keystone species that define their ecosystems: they provide shelter, food and habitat

for molluscs, bacteria, crustaceans, insects and fish alike while oxygenating the

water and acting as highly effective cleaning agents, stripping water of nutrients,

some heavy metals and a variety of other toxic compounds. They have also been

acknowledged as potentially valuable geoengineering agents (particularly

microalgae) through their ability to capture carbon dioxide during photosynthesis

while blooming at prolific rates (Fox and Chapman, 2011). Seaweeds are even used

as end of pipe solutions to remediate aquaculture and waste water treatment plants.

Regrettably it is not within the scope of this thesis to accurately represent algae’s

multiple ulterior values during the analysis, for instance by placing economic values

on ecosystem services, however these are recognised and considered where

appropriate.

3.1.3. Phyco-‐products and their value

Phyco-‐ originates from the Greek word ‘phukos’, meaning seaweed. For the purpose

of this thesis, the vast range of phyco-‐products has been split into four major

categories. There are other at least several other uses and values of seaweeds that

have been excluded from this report, for instance they have been used to absorb

heavy metals in industrial salvage (Stirk & van Staden, 2000) and in waste water

treatment as biofilters (McHugh, 2003). Returning to this thesis, four phyco-‐product

categories have been established for simplicity. The first and by far the largest in

25

terms of market value and global demand are sea vegetables. Second are the colloid

substances such as agar, carrageen and alginate. The third category are compounds

that are used by industries as supplements, known as phyco-‐supplements, adding

value to a great diversity of substances ranging from cosmetic creams,

pharmaceutical products and soil conditioners, to processed foods, dietary

supplements and beer. The fourth and final general category remains untested in

commercial-‐scale application, despite having a well-‐established market: the use of

seaweed as biomass feedstocks for the production of biofuels. The following section

will explore these five product categories, providing some market value estimations

and an elementary overview of production methods.

3.1.3.1. Sea vegetables

As formerly presented, sea vegetables are the biggest players in the global seaweed

market with an estimated value of around US$ 5 billion. The majority of demand

however is in the Far East, so they could be mistaken as being of little interest for

European cultivations. The comparatively small European demand for sea

vegetables is conversely on the rise (Walsh and Watson, 2012). There are hosts of

innovative phyco-‐food-‐products that have been emerging for the last decade,

marketed as healthy eco-‐foods and snacks, flavourings and seasonings. Chefs across

the world use such products as secret ingredients or decorations in the high-‐end

Michelin restaurants. As Per Rehnlund confirmed in our interview, from his

personal experience at Leroy AB, as long as the sea vegetables are of high quality,

their value, marketability and demand is unmistakable in Europe.

Table 2 below shows a typical selection of phyco-‐food-‐products available for

purchase on the Internet or in typical European supermarkets. This selection has

been made based on cultivation potential by European seaweed species. The market

values are purely to paint a basic picture of their value, and were obtained from

26

quick searches at a variety of retailers on the Internet. All prices have been

converted to US Dollars.

Table 2 – Description and approximate values of typical algae-‐based foods Product Description Market value Kombu or Kelp

Dried seaweeds of the Laminaria genus, some of which are native to European waters. Nutritious and a favourite in Asia, Kombu is used in a large variety of dishes and dried snacks.

$6-‐27 for 50grams

Winged Kelp (Alaria esculenta)

Traditionally eaten in Europe and Canada for centuries, this kelp can be eaten dried as a snack, in fresh salads and in soups or other dishes.

$4.69 for 100grams (frozen)

Slaw Kelp (Laminaria digitata)

Pre-‐cooked and frozen, this product is recommended for use in soups, salads, and stir-‐fries or as an accompaniment to fish or red meat.

$4.69 for 100grams (frozen)

Sweet Kelp or Kombu Royale (Saccharina latissima)

Harvested when they are small, these kelps are characterised by a distinctly sweet taste. Traditionally used as a grazing crop for sheep to sweeten the meat, today they are commonly found in salads and mains just like in deserts and cocktails.


Sea Spices Available as flakes to be added as spices to cooked dishes, the ease of use, high nutritional value, surprising variety and niche flavours offered by these combinations of seaweeds has led to this innovative product being a great success amongst high-‐end European chefs.

$7.50 per unit (100grams)

Phyco-‐products from sea vegetables are diverse and have relatively high market

values. With no costly investments involved, they are easy and cheap to produce and

hold potential in being highly profitable to businesses. The only downside is that the

European demand is relatively low and that competition for these products is fierce

amongst producers (Wegeberg and Felby, 2010).

3.1.3.2. Phycocolloids

In chemistry substance mixtures are classified into three types: solutions,

suspensions and colloids. Colloids are defined as containing particles ranging from 1

to 1000 nanometres in diameter and remain evenly distributed throughout the

27

substance. That is to say the particles do not settle or separate over time. This

contrasts with solutions in that they have a tendency to separate, while suspensions

contain particles that are usually visible to the naked eye. Colloids are a highly

diverse group of mixtures with an equally varied set of chemical properties. Colloid

products that are extracted from algae, that is to say phycocolloid products, are

usually one of three: agar, alginate and carrageenan. The seaweeds from which they

are extracted are usually harvested and selected for quality over quantity. (FAO,

2003)

Agar is most commonly used as a thickening, emulsifying or stabilising agent for

food (vegetarian alternative to gelatine), as a mild laxative component in

pharmaceutics products, but also as the growth medium for bacteria and fungi in

petri dishes due to its solidifying temperature, which is ideal for experiments

incubated at human body temperature. Boiling certain species of algae results in the

breaching of cell walls and the release of two structural polysaccharides. Together

these polysaccharides form agar, which can be dried into a fine powder ideal for

storage. Thanks to such niche uses, the market for agar is global and well

established but somewhat limited when compared to sea vegetables. It is mass-‐

consumed by the food processing industry, laboratories and the general public.

Standard agar-‐agar can be purchased both online and in supermarkets for

approximately US$10 for 100g, while higher quality agar used in laboratories can

fetch up to US$2 per gram. (FAO, 2003)

Similarly to agar alginates are characterised by gel-‐like properties, or more

specifically, their ability to make aqueous solutions more viscous. Today they are

widely used in food processing (sauces, ice creams, syrups, biscuits, canned foods),

pharmaceutics (specialised open wound dressings, slow release medicines),

immobilising biocatalysts in industrial processes, the printing industry, and as

additives to animal feeds, most notably fish feed. Alginates are sold as dry and

powdered sodium alginate, produced by a three step process: first the seaweed cell

walls are broken by stirring and leaving them in a hot alkaline solution, creating a

28

thick slurry which, when diluted with water and filtered to remove any insoluble

seaweed cellulose; the second step involves the precipitation of either alginic acid or

calcium alginate, two alternative processes that lead to the same result; and finally

these substances can both be converted back to sodium alginate by adding a mixture

of alcohol and water. Alginates can also be purchased online for US$9-‐47 for 50g,

depending on the quality, viscosity, specific properties and applications of the

alginate in question. (FAO, 2003)

Carrageenan is another viscosity agent and is most commonly used in dairy

products, meat processing and other miscellaneous products like toothpaste, air

freshener gels and pet food. There are two major forms of carrageenan resulting

from two different production methods. The first is significantly cheaper and

produces a ‘natural grade carrageenan’ (lower quality), simply involves washing the

seaweed and dissolving compounds in water and alkaline solutions, followed by a

drying process. This natural grade carrageenan is available online for anything from

US$10-‐24 per 50g. The second involves series of chemical processes and filtrations,

dehydration by the addition of alcohol followed by auxiliary drying, producing a

refined high quality carrageenan which is significantly more expensive and is sold in

bulk to industry. (FAO, 2003)

3.1.3.3. Phyco-‐supplements

The high nutrient content in seaweeds (vitamins, protein & minerals), as well as a

range of valuable and specialised fatty acids, enzymes, carbohydrates, pigments,

antioxidants and polymers have raised the profile of seaweeds in recent years, most

notably in the realm of biotechnology. The European Science Foundation’s Marine

Board estimated the blue biotechnology global market as standing in the region of

€2.8 billion in 2010, while forecasting annual growth between 5 and 12%

(Querellou et al, 2010). It is not within the scope of this thesis to examine all the

29

potential avenues of growth of this industry, so a selection has been made of some of

the more significant product research and development areas.

A biorefinery approach to the extraction of products from seaweeds and other

marine organisms (sponges, molluscs, sea worms, bacteria and fungi) is thought to

hold the most significant potential for business and industry, through a fractionation

of processes for multiple end products (Langeveld, 2012:111-‐130). Core to research

and development in the field, biorefineries are still being designed by metabolic flux

modelling and tested at pilot scales. One of the core objectives of SEAFARM is for an

interdisciplinary collaboration across different Swedish universities to produce

such a pilot biorefinery system.

In terms of end products, it is hoped that a wide range will be derivable while

wastes are expected to contribute toward biomass feedstocks or soil additives. A

few existing products include animal feed and omega 3 supplements, hydrating and

anti ageing creams from Laminaria species. A total of 4900 patents associated with

genes of marine organisms had been filed by 2010 (Submariner, 2012:128). A host

of innovative products are being developed, trialled, licensed and will soon be

available to the public. Below, table 3 shows some examples of existing phyco-‐

supplements and their associated market values, to give a basic idea of the value of

this growing industrial sector.

Table 3 – Description and approximate values of typical phyco-‐supplements Product Description Market value Animal Feed Available as pellets, liquid (for dilution in drinking water),

or flakes, the essential nutrients in algae make these increasingly sought after, particularly by equestrian breeders, but also in industry.

$10-‐50 per kg

Plant Feed Also available in a range of strengths and forms (liquid, pellets, powder, etc)


A Vogel VegOmega 3

A vegetarian alternative to fish-‐oil based omega 3 tablets, Eucheuma genus seaweeds

$29 for 60 tablets

Cellumend cellulite

Cellulite nodule removal and prevention cream, made from Liporeductyl, a patented molecule found in

$74.99 for 125ml

30

cream Laminaria digitata. Clinical trials have proven it to be one of the most effective cellulite treatments available to date.

Seagreens Food Capsules

Certified as organic, vegan and sustainably wild harvested, these clinically trialled capsules are reputed to be one of the best dietary supplements available for humans.

$25 for 60 tablets

3.1.3.4. Marine biomass feedstock for biofuels

The race to find a viable replacement for hydrocarbons is well underway. Initially

produced to mix with fuels thus lowering costs and acting as a buffer to rapid fossil

fuel price fluctuations, biofuels have been on the rise since the 80s and are widely

accepted as a ‘green’ or carbon neutral source of energy (UNCTAD, 2008). Large-‐

scale biofuel feedstock sourcing, however, has resulted in much controversy

through unforeseen knock-‐on effects, such as land grabbing and deforestation to

make way for feedstock cultivations like sugar cane, jatropha, rapeseed and oil

palms (GRAIN, 2013).

Marine biomass has emerged as an alternative feedstock with distinct advantages

over their terrestrial counterparts (Rodolfi et al., 2009; Wegeberg and Felby, 2010):

algae are richer in energy (lipids, starch) than terrestrial alternatives, while also

having a low lignin content, facilitating digestion (Schenk et al., 2008; Sialve et al.,

2009); they are by far the fastest growing potential feedstock source (Muñoz et al.,

2004); their role in ecosystems is to lock up carbon dioxide and filter water (strip

nutrients), thus holding the potential to act as geoengineering agents, perhaps

reversing eutrophication or slowing the rise in atmospheric CO2 if cultivated on a

large enough scale (Hernandez et al., 2005; Chopin, 2006); they do not compete with

arable, wild or protected land; they do not add to fresh water stress; and perhaps

most importantly, the supply chain technology is rapidly approaching a profitable

state, most notably anaerobic digestion to biogas (Bruton et al 2009; Dave et al

2013).

31

As the notorious J. Craig Venter said following his controversial finalisation of the

first synthetic genome: “Whoever produces abundant biofuels could end up making

more than just big bucks – they will make history… the companies, the countries,

that succeed in this will be the economic winners of the next age to the same extent

that the oil rich nations are today” (Synthetic Genomics, Inc., 20 April 2009; quoted

in ETC Group 2010). Marine biomass brings this opportunity to all countries with a

coastline; it is an alternative to land-‐based fuel dependence, offering solutions to

better manage our oceans while generating food, employment, sustainable products,

local economies, and a new ‘green growth’ sector.

Indeed there is huge potential for a marine-‐centric bioeconomy and marine

feedstocks, however few trials have been conducted and none at all at a commercial

scale. It has been suggested that with the technologies currently in hand, the cost of

cultivation needs to be reduced by a factor of four or five for operations to break

even and become viable and financially attractive to investors (Bruton et al., 2009).

Some key challenges have been identified and attempts to overcome them are being

undertaken.

Once such attempt is the BioMara project (2009-‐2012) coordinated by SAMS in

Scotland. It was amongst the first major European funded marine biofuel research

programs. Developed as a preliminary investigation to answer some key questions

to help develop a Scottish/Irish marine biofuel economy, so far, this project is the

closest we have come to achieving commercial scale trials for biogas production.

Some recently published reports shed some light on these techno-‐economic issues,

the findings of which are summarised hereafter.

Dave et al. (2013) conducted a mass-‐energy balance pilot investigation in a selected

Anaerobic Digester (AD), modelling the chemical processes using the ECLIPSE

software. The biogas from the selected AD of 1.6 MWth (macroalgae feed rate of 8.64

dry tonnes per day) was burned in a combined heat and power plant generating 237

kWenet of electricity and 367kWeth of heat. Each tonne of dry macroalgae feedstock

32

was valued at €50, including cultivation, pretreatment and transport costs. The

resulting Break-‐even Electricity Selling Price (BESP) was in the region of 120

€/MWh over a 17 year payback period. This was calculated using cost data, techno-‐

economic elements of the ECLIPSE software (material costs, insurance, etc), an

assumed heat selling price of 20 €/MWh and finally, a digestate cost of €7.5/tonne.

The estimated accuracy of the cost estimation is ±30%, given the variability of all

the component factors. (Dave et al., 2013)

When comparing the BESP for this pilot study to other electricity cost prices, it is

clear that the technology is indeed approaching a state of profitability. In the UK

where the study was conducted, the average cost of 1MWh at a consumer level

according to the BERR averages at £151.30 (Confused about energy, online), which

is equivalent to €177. In context with the variation of ±30% from the estimated 120

€/MWh BESP, there would be almost no profits to make the proposed scheme a

viable business enterprise, however by lowering costs, scaling up and achieving

economies of scale, the potential is there for profits to be made. (Dave et al., 2013)

The calculations for BESP in Sweden however would yield very different results

reflecting the generally higher costs there, so a BESP in the UK is not comparable to

the same exact project in Sweden. Nevertheless, table 4 below shows the electricity

prices in Sweden, arranged as they are into categories according to annual

consumption.

Table 4 – Statistiska centralbyrån energy prices for natural gas and electricity

(SEK/MWh). Source: SCB (2013)

Consumption Categories (MWh/year)

<1 1 -‐ <2.5 2.5 -‐ <5 5 -‐ <15 >15

2007 January to June 2500 1450 1440 1280 1140 July to December 2700 1610 1500 1360 1220

2008 January-‐June 2690 1760 1590 1390 1270

33

January to June 2930 1920 1720 1490 1360

2009 January-‐June 2770 1950 1740 1490 1400 January to June 2850 1890 1710 1480 1350




2007-‐2012

Total Average 2954 1873 1719 1490 1352 Total Average (€) 343 217 199 173 157

As you can see from the table above, the average cost of 1MWh is on the rise, having

increased on average (in all categories) by 23% over 5 years, a trend which is

reflected throughout Europe as governments and companies attempt to move

toward sustainable energy generation.

As already discussed, it would be inaccurate to make a direct transposition of the UK

developed BESP (120 €/MWh) to the case in Sweden, however for the sake of this

report it shall be considered nonetheless, with a pinch of salt. In essence what the

report findings indicate is that an exact copy of the project by Dave et al. (2013)

would be a profitable venture, providing electricity at approximately 60-‐80% of the

retail price of the least expensive price bracket and 25-‐45% of the most expensive,

leading to interesting returns and a theoretically much lower BESP in Sweden.

Of course the UK BESP being applied to the Swedish market warps the situation and

an equivalent pilot study in Sweden would be necessary to determine the profit

potential of such a plant. Other studies have shown similar results however the

costs of cultivation, AD plants, materials, labour and insurance amongst many other

factors can vary immensely from place to place, leading to very different results and

a high degree of uncertainty. In essence other studies have found that there is

potential to make profits through such ventures, however at the moment the risks

34

are too high and the profit margins are too low and unclear (Bruton et al., 2009;

CREW, 2012).

Another important note from the above pilot study conducted by Dave et al. (2013)

is that the biogas generated in this study is converted directly into electricity and

heat, as opposed to being sold directly as biogas. However the latter option, selling

the biogas directly, would make it very expensive and non-‐price competitive with

natural gas, which is considerably cheaper. Over the coming years however, as the

AD processes are optimised and cultivation techniques become more automated

and cost effective, it could be expected that overall costs will drop to a point where

this direct sale of biogas may become viable.

3.2. AQUACULTURE

Everyday 200’000 new people are brought into this world quadrupling population

over the last century while the most conservative estimates forecast a continued

increase to 9.2 billion by 2050, and further beyond that (UN Population Division,

2007). There is no doubt that this huge population growth is now irreversibly

affecting the environment, particularly oceans.

Over 1 billion people depend on global fish stocks for their livelihoods and as a

principle source of protein (FAO, 2003) – and the depletion of these stocks is

amounting to trepidation amongst world leaders who are looking into new ideas on

how to manage our oceans long-‐term, while feeding a growing population and

supplying it with clean energy. Just like our hunter-‐gatherer ancestors settled and

developed agriculture to raise the carrying capacity of the land thousands of years

ago -‐ today we face the same challenge with our oceans.

It is easy to confuse the aquaculture of fish and seaweeds, given the same word

portrays both. In this section, first the aquaculture of fish will be presented on a

35

global scale, and then the aquaculture of seaweeds will be explored as a source of

food and energy. Thereafter, the emerging field of Integrated Multi-‐Trophic

Aquaculture will be presented, and it will be concluded that single trophic

aquacultures are necessarily a thing of the past and that sustainable aquaculture can

only come from meticulously designed multi-‐trophic aquaculture.

3.2.1. Fish aquaculture

Typical aquacultures are undertaken as monocultures, with a single or sometimes

several species being cultivated in ponds inland or off-‐/nearshore sheltered areas. It

is also commonly known as intensive fed aquaculture, shellfish or finfish

aquaculture. Initially, very little research was carried out on the short and long-‐term

effects of introducing the cultivation of a single species in an ecosystem, mainly

because there was so much profit to be made that the focus was on expansion of

farming practises. Take salmon production for instance; an explosive shift took

place between 1990 and 1991, as global salmon production grew from about 7’000

tons to a little over 325’000 tonnes -‐ an increase of some 4,600% (Weber, 1997:4).

In 2010 it was estimated that the value of the global aquaculture industry was in the

region of USD 119.4 billion, producing an estimated 59.9 million metric tons of fish,

crustaceans, molluscs and other aquatic animals (FAO, 2010).

The environmental implications of the industry have only recently become subject

of major studies at a global level. Many different techniques have been developed,

ranging from dive surveys to sediment chemistry, with four major areas of concern

found to be recurrent throughout these studies. They relate primarily to escapes

from farming pens, wastes and eutrophication therefrom, the use of drugs and

chemicals, and of effects on other species such as predatory birds or seals that

attempt to gain access to farming pens (Carroll et al., 2003). There is great variation

however in results from one inquiry to the next, particularly amongst different

methods to investigate the use of chemicals and drugs, as well as the impacts from

36

waste. Some studies find almost no impacts at a distance of 15m, due to dilution of

wastes or chemicals (Brown, Gowen & McLusky, 1987), while other more precise

experiments on benthic composition and sediment chemistry can identify impacts

over 150m away (Klaoudatos et al., 2006). Overall however, the greatest concern

lies in the wastes and eutrophication, and the resultant anoxic environment in close

proximity to farming pens as well as knock on effects therefrom (Karakassis et al.,

1998).

It is worth noting that of all the sectors of food production in the world adapting to

cater for a growing population, aquaculture is the fastest growing with an average

growth rate of 6.9% per annum (FAO, 2005). In 2006 aquaculture equalled wild

fisheries in the world’s fish supply, however these growth rates are beginning to

slow down, partially from growing public concern with regards to environmental

impacts, genetically modified organisms, fish quality and sanitary issues (FAO,

2005). Another major reason for decreasing growth rates is that these fish

aquaculture are usually for top predators (for instance salmon, cod, haddock or

trout), and the feed for these carnivorous fish usually comes from wild fishery

captures. Thus wild fish are captured in the order of 10 tonnes per ton of

carnivorous cultured fish they are fed to (Chopin et al., 2001), meaning this

feedback loop increases the demand and our dependence on wild fish captures,

rather than developing a replacement for it (Folke et al., 1998). Needless to say the

fish aquaculture industry needs to evolve to a higher state of being, more in tune

with the aquatic environment, the reality of withering global fish stocks and public

concerns.

Thus far aquaculture of marine animals has been considered but an essential part,

more relevant to this study, is still missing: the cultivation of aquatic plants. In the

IMTA section 3.3 later in the literature review, recent research will be presented to

demonstrate how the aforementioned environmental impacts of fish aquaculture

can be mitigated. But first the focus will turn to the cultivation of seaweeds.

37

3.2.2. Seaweed aquaculture

It is estimated that the value of the global seaweed industry lies in the region

between US$ 5.5-‐6 billion per annum (FAO 2003). Seaweeds have been cultivated

for millennia in Asia, notably in China, the Philippines, Indonesia, Korea and Japan

where macroalgae have long been a pillar of traditional food staples. However in

recent years production has begun to increase rapidly outside of Asia, most notably

in Norway, Chile, Russia, Ireland, Mexico, the UK and France (Roesijadi et al. 2010).

Why this sudden change? There are several reasons, but perhaps most prominent is

the search for techniques to sustainably cultivate marine biomass for biofuel

production, to reduce stresses on available arable land.

The high levels of interest in biofuels comes from the fact that they are, in theory at

least, carbon neutral: the CO2 emitted in combustion of a biofuel is initially

sequestered by photosynthesis, thus recycling the carbon. Furthermore biofuels are

chemically very similar to fossil fuels, and in many instances can quite simply

replace fuels used today, neither requiring considerable infrastructural upgrades

nor new technologies. However surrendering vast swathes of arable land to grow

energy crops seems counterproductive particularly given the growing demand for

food, and that many of these crops are grown with petroleum-‐based fertilisers.

Increasingly this trend is also having unforeseen knock on effects, for instance land-‐

grabbing in Africa (Zoomers, 2010).

Marine environments motion answers to many of these problems, offering the

medium in which to grow energy rich aquatic biomass, ideal substitutes of land

based energy crops, without competing for arable land. Further still, research shows

that combined fish and seaweed aquaculture could take over the global market

share of wild fisheries, providing price competitive and potentially environmentally

positive culture systems (Chopin et al., 2001; Ridler et al., 2007; Chopin, 2011). This

will be presented in the later section on IMTA. In a Baltic context, however, algal and

38

finfish aquaculture has been carried out in the Baltic region for decades, but the

potential is there for a vast increase in capacity, not just to produce food but also to

participate toward a smörgåsbord of sustainable energy sources and bio-‐based

products (Blidberg and Gröndahl, 2012).

Very little evidence has been gathered in academia regarding the environmental

impacts of off-‐ or nearshore production of macroalgae on a large scale. The only

major concerns that have been raised, consider potential impacts on benthic

ecosystems during the installation of anchors of cultivation systems, and shading

impacts of an operational aquaculture. In fact, much research suggests quite the

opposite. Algae are seen as highly environmentally positive through their ecological

role as nutrient biofilters. As long as seaweeds are removed from water when

mature (i.e. they are not left to sink and decay), pollutants are fixed in the biomass

and removed from the water, including phosphorus, nitrogen, ammonia and several

heavy metal groups, depending on the algae species in question (Chopin, 2006;

Abreu et al., 2011; Ferreira et al., 2012). Potential has even been accredited to algae

as a relatively safe agent for use in geoengineering to reverse eutrophication (Fox

and Chapman, 2011), however in practise, this remains relatively undocumented

other than one trial conducted in 2012 (Marshall, 2012).

3.3. IMTA: INTEGRATED MULTI-‐TROPHIC AQUACULTURE

Despite being the fastest growing sector of food production, the rate of growth of

fish aquaculture has begun to decline in the face of growing public and

environmental concerns (FAO, 2010). The move from traditional aquaculture

toward IMTA is quite simply a necessary evolution, as the latter holistically

addresses the formers’ shortcomings. It is the birth child of our increasing

knowledge of nutrient flows, bad cultivation practises, the natural world and

mounting environmental concerns. In IMTA, the fish-‐excreted ammonia, phosphates

and CO2 are assimilated into biomass by seaweeds and shellfish (Abreu et al., 2009),

39

mitigating the impacts of an otherwise direct discharge of nutrients into the

environment.

In the words of Thierry Chopin, one of the greatest advocates of IMTA, past

president of Aquaculture Association of Canada and current president of the

International Seaweed Association: “Such a balanced ecosystem approach provides

nutrient bioremediation capability, mutual benefits to the co-‐cultured organisms,

economic diversification by producing other value-‐added marine crops, and

increased profitability per cultivation unit for the aquaculture industry” (Chopin et

al., 2001). This section aims to explore such claims first by exploring how IMTAs

have come about, then by reviewing experiments that attempt to quantify the

benefits of IMTAs, and finally by interviewing experts in the field.

3.3.1. Defining IMTA

Inherent to the concept of IMTA is the key word ‘trophic’. Derived from the Greek

word trophē, meaning food or feeding, trophic levels are used to describe an

organism’s position in a food chain. Trophic levels are now used to describe a series

of key ecological processes within ecosystems, namely the transfer of energy in the

food chain and the cycling of nutrients between different species types. Figure 3

below is a typical marine trophic pyramid, which illustrates the transfer and loss of

energy as it passes from primary producers (photosynthetic organisms) to primary

consumers (herbivores), to the secondary, tertiary and finally, to top consumers

(carnivores). The pyramidal shape helps to visualise the loss of energy between

each trophic level due to the imperfect nature of digestion, which usually converts a

mere 10% of consumed energy into body mass (Duxbury and Duxbury, 1994). As

such, where 10’000 units of energy are available from the sun, phytoplankton are

only able to convert 10% into 1000 units of energy available for primary

consumption by herbivorous zooplankton. Likewise, each step of consumption

converts about 10% of energy into transferable energy (body mass) until we reach

40

the top predators. This is often also reflected in terms of population numbers, not

just body mass. The top trophic levels often have a lower population number than

lower trophic levels.

Figure 3 – Pyramid of trophic levels for a marine environment. Source:

Duxbury and Duxbury (1994)

Thus the current model of industrial aquaculture has created an imbalance in the

natural trophic ordering in our oceans. Consumers tend to favour species of top

consumers (salmon, tuna, cod, etc.) which are mass-‐produced in cages consume vast

amounts of feed (usually a combination of harvested fish stocks, chicken, and other

cheap sources of protein and supplements). So by multiplying the effluents from the

top consumers, in other words, by increasing the importance of the red line on the

left of Figure 3, the environmental load of the effluents becomes so great it degrades

local water quality, and if this is not carried away by currents and diluted, it can

result in severe eutrophication. This also raises questions about the long-‐term

effects of dilution of such effluents, particularly given that such aquacultures already

proliferate globally on a huge scale.

IMTA attempts to rebalance the equation, by integrating multiple trophic levels into

single cultivations. If the design process is well executed, with careful quantification

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41

of nutrient flows, and calculated positioning to maximise inter-‐species synergies,

the result is an engineered ecosystem designed to have balanced nutrient flows and

trophic populations, thus minimising the environmental load (see Figure 4). Such an

engineered ecosystem, it turns out, hold a number of advantages over traditional

aquaculture techniques. In section 3.3.3, some of these synergies are demonstrated

through the reviews of some papers, the full analysis of which can be found in

Appendix B.

Figure 4 – Diagram illustrating an IMTA, featuring finfish, shellfish, seaweeds and invertebrates. Source: Diana et al. (2013) In the interview with Greg Reid, he elegantly summarised that amongst IMTA

researchers and in the industry, it is generally accepted that there are three types of

IMTA. In the first instance, an existing finfish aquaculture is transformed into an

IMTA by the integration of other trophic levels to reduce the environmental loading

from the initial mono-‐trophic finfish cultivation, thus diversifying production and

improving revenue (Ridler et al., 2007). This is known as the add on approach. In the

second instance, the IMTA is designed from scratch in a virgin or disused

environment, allowing full control and flexibility over the plans. This is known as

the custom designed IMTA. The third and final type of IMTA comes into existence

42

through trial and error, with the developers selecting methods that provide the

greatest yields and highest quality produce. It has been documented and applied

over four millennia ago in China and through the ages since: this style is known as

an incidental IMTA and is the subject of the next section.

3.3.2. Ancient Origins

Aquaculture in all its forms has been happening for centuries. Over the course of

time, there is no doubt that combinations of cultures have been incidentally

stumbled across and identified as effective design recipes (Troell et al., 2003). The

reasoning behind them however differs very much from today: in the past,

polycultures sought to satisfy a complex mix of social pressures, local supply and

demand, and lack of resource availability (Ruddle and Zhong, 1988); today IMTA is

conceptually driven by bioremediation and profit potential. The wisdom integral to

traditional farming techniques has been accumulated over generations; IMTA is

quite simply a new name for an old trick, with specific emphasis on using species of

different trophic levels while attempting to quantify and balance the whole in terms

of nutrient flows (Chopin, 2013).

The earliest written record of the integration of multiple species in aquacultures is

accounted in the You Hou Bin document, published by the ancient Han Dynasty of

China in the period between 2200-‐2100 BC. Recommended methods (pen, cove and

cage systems) and their benefits are presented notably for the co-‐cultivation of fish

with aquatic plants and sea vegetables (Costa-‐Pierce, 2008:10). Historical evidence

however suggests that such multi-‐species aquacultures are predated by up to a

millennia by the Etruscans, who practised active coastal management with sluice-‐

like structures to enclose lagoons, thereafter conducting multi-‐species aquacultures

at those sites (Costa-‐Pierce, 2008:15). Nonetheless it is widely accepted that the

Chinese were the first to recognise and document synergies in multi-‐species

cultivations.

43

In the period of 2000-‐1000 BC, successive dynasties would rewrite these

documents, building on previous knowledge. The incorporation of carp, mulberry

trees and rice paddies became a common example of practise around 1100, after the

publication of Lin Biao Lu Yi (The Curious of Ling Biao Region) by Liu Xun which

elaborated on the theory of mutualism in rice-‐fish cultures and the integration of

fruit production (Costa-‐Pierce, 2008:10; Chopin, 2013). Increasingly detailed

accounts would continue to be published for many hundreds of years, culminating

with a milestone act around AD 618, when the common carp was banned from

cultivation due to its resemblance in Chinese to the then Emperor’s name – Li. As a

result species diversification ensued and soon cultivation moved on to combine

multiple species of carp and their integration with various sea vegetables and

plants, as adapted from neighbouring Vietnamese practises (Chevy and Lemasson,

1937). Ancient Egypt is also known to have practised polycultures as early as 1550

BC under the New Kingdom, with Tilapia grown in in integrated agriculture-‐

aquaculture drainable ponds (Chopin, 2013).

Chopin (2013) recounts a royal IMTA practised at the ‘Étang aux Carpes’ (still active

today) at the Château de Fontainebleau, as a result of instructions by the French

King Henry IV who insisted that the castle should be self-‐sufficient. In the 1970s,

John Ryther rekindled interest in IMTA and is considered by Chopin as the

grandfather of IMTA based on his work “integrated waste-‐recycling marine

polycultures systems.” This work developed prototype biofilter mechanisms using

microalgae to strip excess nutrients from wastewater, thereafter feeding the

microalgae to oysters, clams and other bivalves molluscs. In turn, worms,

amphipods, lobsters and other small invertebrates of commercial value feed upon

the wastes from the shellfish. Finally, Ryther introduced various species of Red

Algae to remove any other excess nutrients, resulting in a final effluent virtually free

of inorganic nitrogen, thus not contributing to eutrophication or pollution (Ryther et

al., 1975).

44

The term Integrated Multi-‐Trophic Aquaculture was coined some thirty years later

at a workshop in 2004: Thierry Chopin, Jack Taylor, Stephen Cross and other

research leaders of ‘eco-‐friendly’ aquaculture finally agreed that what they were

talking about was in fact the integration of species across different trophic levels,

thus mimicking natural ecosystem flows yet adapting them for harvestable

productivity. As summarised by Chopin: “It [Ryther’s 1975 paper] was followed by

three productive decades on what has been variously called polyculture, integrated

mariculture or aquaculture, ecologically engineered aquaculture and ecological

aquaculture. Understanding the need to harmonize all these names, the author

[Chopin] and Jack Taylor combined integrated aquaculture and multi-‐trophic

aquaculture into the term integrated multi-‐trophic aquaculture in 2004.” (Chopin,

2003:16)

Returning to the initial aim of this thesis, specifically the search for the sustainable

cultivation of seaweeds, it would seem that IMTAs whether incidental, custom

designed or added on have demonstrated their sustainability quality, by standing the

test of time.

3.3.3. Quantifying IMTA Synergies

To develop pathways for an economically viable aquaculture on the west coast of

Sweden, it is important to explore the potential benefits of potentially basing the

design of the cultivation on IMTA principles. This section aims to scrutinise four

reports and experiments that have aimed to quantify the synergies and demonstrate

benefits of IMTA systems, in view of supporting the development of scenario TWO

in the latter part of the thesis. For full details on these experiments, see Appendix B.

The first report predates the coining of the term IMTA and was carried out by Troell

et al. (1997) in the Metri bay of Chile, between January and March 1995, as a follow

up to the report by Buschmann et al. (1994). The report investigated growth rates of

45

blue mussels and Gracilaria chilensis 10m away from salmon cages, compared to a

site 150m away and a reference site 1km away. Each site had an identical layout,

with close to identical environmental conditions and currents. Growth rates were

measured regularly over a period of three months, and the results concluded that

growth rates were 20-‐40% higher at the site that was 10m away from the salmon

cages, while growth rates at 150m and 1km distance were almost identical. It was

found that the effluents from the salmon cages acted as fertilisers for the seaweed

and mussels growing 10m away. This inter-‐trophic fertilisation has been further

documented in other reports since then. In the interview with Stephen Cross, he

confirmed that experiments he has taken part in had accurately measured growth

rate improvements of up to 50%. (Troell et al., 1997)

The second chosen report identifies another synergy that emerges from the

integration of multiple trophic levels in an aquaculture: that is the improved

resilience to disease and pests. Molloy et al. (2011) set out on an experiment, based

on the hypothesis that blue mussels ingest certain salmon pests and diseases,

notably the sea louse, Lepeophtheirus salmonis, and therefore could act as biological

control agents in cultivations. Undertaken laboratory conditions the hypothesis was

confirmed. A follow up study is being undertaken in the Bay of Fundy to explore this

potential in open waters, where the pesticide resistant strains of sea louse are

already threatening vast numbers of salmon aquacultures. Different three-‐

dimensional configurations will be developed, and if proven successful, mussel long-‐

line cultivations could be introduced as a biological control agent, protecting salmon

crops while adding potential value to those cultivations.

This same location, the Bay of Fundy, has also been subject of other IMTA related

studies. A ten-‐year economic feasibility model was developed by Ridler et al. (2007)

to understand the impact of upgrading a 500’000 smolt salmon farm to an IMTA.

Included in this model was the costs of introducing the blue mussel and seaweed

long-‐line upgrades, the operation and maintenance costs of each system and their

corresponding revenues. Three scenarios, a best, a worst and an intermediate one

46

were established according to losses and to risks. The results from the running of

the model found that no matter which scenario was selected, the subsidiary incomes

from mussels and seaweed buffered the effects of salmon losses, while also paying

for themselves within the ten-‐year period. Principally the results show that one bad

salmon harvest can suffocate profits of a salmon monoculture over a ten-‐year

period, whereas IMTA provides the diversity of economy to maintain a positive

balance sheet and sustain the business. A subsequent re-‐run of the model was

thereafter carried out, this time incorporating market risks subjected in the form of

an immediate 12% decrease in salmon market value carried over a ten-‐year run,

mimicking a similar price drop in the 1980s (Whitemarsh et al., 2006). Similar to the

first results, the IMTA coped better yielding a profit margin of 3.2% compared to

0.3% for the salmon monoculture. (Ridler et al., 2007)

Similar results have been found in studies of land-‐based IMTAs. In a study by Nobre

et al. (2010), two schemes for IMTA developments were once again compared to a

monoculture, this time of abalone, with specific aim to compare the economics of

the two systems while also monitoring the changes in the state of ecosystems during

the study period. The authors based the methodology on a recent modification of

the DPSIR framework, the Differential Drivers-‐Pressures-‐State-‐Impact-‐Response

(ΔDPSIR) proposed by Nobre (2009) to support sustainable coastal management

decision makers. The results of the study showed first and foremost that the IMTA

scemes paid for themselves within the first financial year, and despite increasing

labour costs, they also increased overall operational profit. Secondly the IMTA

schemes reduced discharges of nitrogen and phosphorus by 44% and 23%

respectively, while also reducing net CO2 emissions. “The quantified environmental

externalities [of these reductions] corresponded to an overall economic benefit to

the environment and thus to the public, of about 0.9 million and 2.3 million USD

year-‐1 upon shifting the farm practice from abalone monoculture (scheme 1) to the

IMTA schemes 2 and 3, respectively” (Nobre et al. 2010:123).

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Some reports have focused solely on this bioremediation capability of seaweeds.

Huo et al. (2012) monitored the nutrient reduction efficiency of Gracilaria verrucosa

when co-‐cultured with Pseudosciaena crocea in the coastal waters of Xiangshan

harbour in the East China Sea. “The maximum reduction efficiency of PO4–P, NO2–N,

NH4–N and NO3–N was 58%, 48%, 61% and 47%, respectively” (Huo et al.,

2012:99). It was thus found that for a balanced system in term of nutrient discharge

and uptake, one cage of P. crocea required a cultivation area of 144.95m2 of G.

verrucosa, or 1kg to 7.27kg respectively. The bioremediation capability of this

particular gracilaria species was confirmed in this study.

The above five reports summarised in this section were selected as convincing

examples of the potential of well-‐designed and executed IMTAs, in five very

different areas. The first demonstrated the inter-‐trophic fertilisation between

species (Troell et al., 1997). The second identified that IMTAs might be more pest

and disease resistant than their counterparts (Molloy et al., 2011). The third

modelled an economic assessment of IMTA versus a monoculture, finding that the

former strengthened the economic resilience by diversifying products while also

paying for itself and increasing returns (Ridler et al., 2007). The fourth similarly

reported the benefits to a monoculture’s economy through upgrading to IMTA style

operations, but it also assigned a value of between US$0.9-‐2.3 million for the

environmental externalities reduced as a result of the change to IMTA (Nobre et al.,

2010). The fifth and final report in this section confirmed the open sea

bioremediation capabilities of Gracilaria verrucosa, while also demonstrating a

procedure to balance out bioremediation with effluent output, to create an

environmentally neutral (in terms of nutrients) open sea cultivation (Huo et al.,

2012).

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4. CASE STUDY: BIOMARA

BioMara was a joint UK-‐Irish, €6 million four year research project led by a team

from SAMS [Scottish Association for Marine Sciences] from 2009 to 2012, to explore

the feasibility of yielding third generation biofuels from marine biomass. The idea

came about in reaction to the EU Parliament setting the target for all members to

achieve at least 10% transport fuels from sustainable sources by 2020 (Council

Directive 2009/28/EC). Terrestrial crops for biofuels are neither a viable nor

sustainable option for Scotland given the lack of suitable agricultural land, thus to

achieve the goal set by the EU, it was decided to look to the oceans for answers.

The aim was to explore all avenues of biofuel generation from both seaweed and

microalgae in Scotland, and accordingly the project developed four core objectives.

The first was to identify the most appropriate species of seaweed and cultivation

techniques for bioethanol and biogas generation. The second was to identify some

oil rich microalgae in view of extracting biodiesel (irrelevant to this thesis and will

not be elaborated). Third was an evaluation of the environmental impacts of algal

cultivation and harvesting of natural stocks. And finally to achieve a holistic

perspective on the final objective, close collaboration with and the education of

stakeholders was seen as essential in order to evaluate the technological and socio-‐

economic practicalities of producing competitive and sustainable biofuels from

marine sources.

This case study aims to provide the reader with an overview of the journey

undertaken by the research collaboration of BioMara, their major findings and how

these should help pave an economically viable pathway for SEAFARM. The case

study attempts to answer the following questions

-‐ What were the major findings? -‐ What were the biggest encumbrances of the project? -‐ What conclusions can be drawn from BioMara to serve SEAFARM research?

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4.1. KEY FINDINGS

In the time leading to the BioMara official start date expectations were running high.

It had been hoped that the project would remove the last major hurdles obstructing

the development of a viable algae-‐based economy, paving the way for a new

beginning for the depressed ‘cross-‐border area’ between Ireland, southwestern

Scotland and Northern Ireland. Such hopes are embodied by the role of Ian

Macfarlane, chair of the Stakeholder Group whose role in BioMara was to

disseminate results through industry, raise the profile of research activities

internationally and help nurture research-‐industry partnerships. But as promising

as the algae for biofuels would appear in theory, the project would reveal new

questions requiring further research in seaweed pre-‐treatment, co-‐digestion and

storage, as well as practical encumbrances of cultivation site licenses, which would

need to be overcome before a profitable algal biofuel industry could really take-‐off.

Hereafter are presented the key findings, as summarised in the “Celebrating

BioMara 2009-‐2012” report by SAMS (2012).

4.1.1. Identifying Seaweeds for Biofuel Conversion

Primarily the focus of the research was on brown seaweeds, also known as kelps,

given their relatively high-‐energy contents and thus biofuel yield potential when

compared to other species. Both production processes – bioethanol by fermentation

and biogas by anaerobic digestion – were core to the research objectives.

Fermentation of biomass is carried out by micro-‐organisms that convert sugars into

alcohols, a process refined over hundreds of years by humans to produce a range of

alcoholic beverages, or more recently, fuels. However seaweeds are structurally

very different from their terrestrial counterparts, so existing saccharification

enzymes and chemicals are ineffective, expensive and produce toxic compounds.

Further research is needed to identify higher yielding and more cost effective

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methods, and in comparative terms, it was considered that fermentation was less

cost-‐effective and less energy-‐yielding that anaerobic digestion. The other major

finding relating to fermentation was that, like all plants, the seasons affect cellular

chemical composition. The autumn was identified as the time when sugar content

peaks and thus the most suitable time for harvesting for fermentation. Each species

of seaweed however have slightly differing peak times for sugar content, and also

differ from year to year, so multiple species cultivations should prolong the season

and improve yields.

Pilot tests for anaerobic digestion were carried out and it was identified that the

higher yields can be achieved through a mixture of different seaweeds and added

substrates such as sheep gut rumen and faeces from seaweed eating sheep, as well

as by separating the acidogenic and hydrolytic phases of digestion. Similarly to the

research into fermentation, the ideal harvesting time was also identified as the

Autumn, and preferred pre-‐treatment methods included fresh mincing followed by

freeze drying or air drying, prior to digestion. Vanegas and Bartlett (2013) found

that when co-‐digested with bovine slurry at 35°C in incubators of 150ml and

1000ml, of the common Irish sea kelps, the highest methane yields were obtained

from Saccharina latissima (335ml gVolatile Solids-‐1), followed by Saccharina polyschides

(255ml gSV-‐1) and Laminaria digitata (246ml gSV-‐1).

4.1.2. Harvesting Beach-‐Cast Seaweeds

Prior to BioMara, a serious potential candidate source of algal biomass was beach-‐

cast seaweeds -‐ torn from their footholds usually during storms, these are seaweeds

that are carried by waves and cast at the high tide mark along beaches. Large storms

off the coast of Scotland regularly bring in great volumes of seaweeds, which then

decompose along beaches. The theory was that rather than decomposing on

beaches, these vast algal beds could be harvested and used as feedstock.

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A model was developed by PhD student Kyla Orr (SAMS), which would shed light on

the ecological role of beach cast seaweeds in the region, particularly in terms of

their effects on the local food web, benthic communities, migrating birds and

invertebrate populations. In essence the beach-‐cast seaweeds were found to be the

habitat for a range of organisms upon which migrating birds feed, such as beetles

and flies, thus the model predicted impacts on their population numbers growing in

severity with increased harvesting. Furthermore, the decomposed seaweeds were

found to fertilise and increase productivity of near shore ecosystems, supporting

benthic communities with a slow-‐release source of nutrients. The model indicated,

with a medium degree of certainty, that to minimise environmental impacts on

migrating and local birds, as well as the local ecosystems, no more than 10% of

beach-‐cast seaweed should be harvested in each designated area, and that this

harvesting could only happen every second year, allowing the local ecosystems and

communities time to recover. Further research on beach-‐cast seaweeds also

suggested that they were neither reliable nor a high quality feedstock, and that

overall it would be best to harvest specially cultivated species during the autumn,

when they contain highest densities of fermentable or anaerobically digestible

compounds. (SAMS, 2012)

4.1.3. Technological and Socio-‐Economic Impacts of Biofuel Production from

Marine Biomass

A fundamental part of the BioMara project was to investigate the techno-‐ and socio-‐

economic impacts of the potential seaweed-‐biofuel industry. At a local level, the

potential of the industry is very positive, supplying energy and creating jobs and

revenues in an isolated region subjected to high-‐energy prices and ageing

infrastructure. Some detailed models and plans for pilot AD combined heat and

power plants were developed in an attempt to convince investors to get involved,

however these efforts were unsuccessful.

52

Overall some major hurdles to profitability were identified, notably the labour

intensive nature of seaweed cultivation, unstable annual yields and significant

investment costs. It was estimated that long-‐line systems of 14’400m could yield up

to 100 tonnes of algae, at a market price of about €50 per tonne. Electricity

therefrom was estimated to cost approximately €120 per MWh, with potential to

improve efficiency by integrating combined heat and power plants into the system.

Such systems are estimated, overall, as costing up to €3500 per KW of electricity

generation capacity – several times the cost of equivalent sustainable energy

sources, such as wind or wave power systems. Further research in the area is

needed to reduce process and infrastructural costs, optimise efficiencies for marine

biomass digestion and to estimate the economies of scale that could be achieved by

scaling up production. (Dave et al., 2013)

4.2. PROJECT SETBACKS

One of the biggest obstacles to encumber the momentum of BioMara’s research was

the application process for marine licenses to cultivate algae in near-‐shore

environments. In a telephone interview with Dr Michele Stanley (05/15/2013), she

explained: “We did an Environmental Impact Assessment on the site because back

then it was suggested we were going to cultivate, but we never did. They didn’t get

licenses for a long time, and we’ve had to change sites.” Multiple applications were

filed in the early stages of the project and only recently, some three to four years

later, have licenses been acquired and pilot tests effectively begun. One of the

BioMara financiers, The Crown Estate, had planned to develop a pilot cultivation in

the Lynn of Lorn to provide samples for experiments, yet it is in the wake of

BioMara’s completion that the first few harvests will be attempted.

SAMS and some of the other BioMara research partners have recently acquired two

other licensed sites. The cultivation infrastructure was installed at the Kerrera

cultivation site in February 2013, followed two weeks later by the first seeded long

53

lines, along which macroalgae will be monitored as the grow over a period of

approximately 6 months. Harvests will begin in late summer and early autumn,

providing the old research collaborations with their first cultivation sites. In the

course of BioMara, to undertake anaerobic digestion and fermentation trials, in the

words of Dr Michele Stanley: “we had to beg, borrow and steal from all sorts of

places”, amongst which some neighbouring small mussel cultivations. After years of

unsuccessful attempts, complicated financing issues and licensing terms, the

Kerrera cultivation site is now finally up and running.

4.3. ‘PASSING THE BATON’ TO SEAFARM

In some ways, one could consider the SEAFARM research collaboration as BioMara’s

big sister, picking up research gaps where BioMara left them, while adapting to the

Swedish west coast. So what are the research gaps? What needs to be done before a

viable biogas-‐from-‐algae industry could emerge in Europe?

During the interview with Michele Stanley, she clearly communicated that the

planning for BioMara predated the emergence of biotechnology as a key player in

the development of seaweed resources. Whereas in 2008, biofuels from seaweed

were the subject of excitement and of inherent great promise, today the greatest

potential is seen in the development of new innovative products, and particularly

the fractioned biorefinery approach. These shifts in perspective are reflected in the

research agenda of SEAFARM. Beyond that, Michele also commented on the

importance of investigating marine licensing procedures, and that these can take

many more years that initially forecasted in the planning phase. Licensing should

not be taken lightly, nor should it be assumed that permission for a cultivation to be

granted on any time scale.

Published recently on the 3rd of June, the latest roadmap on the development of algal

biotechnology resources provides estimated timeframes and relative values of each

54

key development area (Schlarb-‐Ridley and Parker, 2013). After reviewing this

report, it was found that the SEAFARM objectives (FA1-‐5) fit effectively into this

framework, most notably regarding the development of the fractioned biorefinery

approach and the suggested investigation into the use of the biorefinery wastes to

develop biofuels and soil additives.

55

5. RESULTS: SEAFARM DEVELOPMENT SCENARIOS

Thus far the present report has presented a wide range of information that has

come from literature and IMTA experiment reviews, interviews, a case study of

BioMara and a field visit of the Sven Lovén Centre in Tjärnö. Hereafter the informed

discussion is engaged, with the aim of exploring three alternative scenarios for the

development of an economically viable SEAFARM.

This exploration of scenarios will have 3 constituent parts. Firstly the scenario

context will be determined by examining Kosterfjorden water quality data obtained

from SMHI, considering the range of algae-‐based products established in section

3.1.3 and some socio-‐ and techno-‐economic information from the literature review.

Secondly, the three scenarios will be designed, inspired by a combination of existing,

planned and fictional cultivations and based upon information gathered in the

literature review, experiment reviews and interviews. Thirdly the scenarios will be

applied in the Kosterfjorden context, providing an analysis of estimated revenues

from the products and anticipated growth rates. This third and final process will be

informed primarily by interviewee experience and SMHI data from the

Kosterfjorden, but also through the wide range of data collected in the literature

review and experimental reviews.

5.1. SCENARIO CONTEXT

In order to apply the three development pathway scenarios, the context in which

they are to be applied must be established. As mentioned previously, this context

has four major elements: the water conditions at the cultivation site, Kosterfjorden,

will be analysed from SMHI data; the selection of algae-‐based products undertaken

in section 3.1.3 will be assigned relative values (very high, high, medium, low, very

low) based on interview discussions and literature, to reflect estimated potential

56

revenue streams from each; the SEAFARM research objectives will be reiterated;

and finally, other socio-‐ and techno-‐economic considerations will be considered.

5.1.1. The Kosterfjorden site

The research collaboration of the SEAFARM project has yet to begin the selection

process of cultivation site, or sites. As such the Kosterfjorden site was chosen for the

purposes of this thesis due to the availability of water sample data collected by

SMHI as well as the Kosterfjorden’s proximity to the SLCMS. The SMHI data has been

collected regularly for many years and gives a historical insight of water conditions

dating back over 50 years. This water condition database includes a wide range of

parameters and nutrient levels, at a variety of depths. A selection of the 6 most

important parameters to seaweed growth was made, based on BioMara’s Final

Stakeholder Meeting report (Groom and Macfarlane, 2012), and are: salinity (PSU),

temperature (°C), and water sample content of nitrate, ammonium, phosphate and

nitrite (mgL-‐1). These 6 parameters are represented in the 4 charts here below, with

a variety of different depths to illustrate the change in values that make up

distinctive depth-‐gradients.

These charts were presented during the interviewing process to Stephen Cross and

Lars Brunner, both of which have extensive experience of seaweed cultivation, the

former on the Canadian west coast and the latter at a variety of sites in Scotland. The

purpose of this section, of sharing this information while interviewing these two

experts, was for experts to loosely evaluate the suitability of the site and identify

any potential problems that might occur in attempts to cultivate seaweeds at the

Kosterfjorden. After consideration of the charts, both experts made comments,

expressed after each chart here below.

57

CHART 1 -‐ Seasonal Fluctuations of Surface Water Temperature Gradients (°C) at the Kosterfjorden in 2012 [Depths (D) of 0, 5, 10 and 20m]. Source: SMHI (2013)

Chart 1 displays the temperature fluctuations for the year 2012, at depths of 0, 5, 10

and 20 meters. As you can see, water temperatures at the Kosterfjorden are

characterised by significant annual fluctuations from the extreme low of -‐0.7°C on

the 7th of February 2012, to a maximum of 19.1°C on the 22nd of August 2012, both

values having been recorded at a depth of 0m. The single most important trend to

take note of is that temperatures fluctuate to a greater extent at the surface and

remain more stable at depth. This is probably due to water mixing at depth and

energy transfers with the atmospheric temperature fluctuations, which are more

pronounced than that of the oceans. It is also evident that the waters generally

warm up until the peak of the summer in August, and then decline steadily until the

middle of winter in February.

Both Stephen Cross and Lars Brunner were of the opinion that these are quite

tolerable variations for seaweed and fish aquaculture. Both commented that it was

particularly positive that the surface waters at the site did not seem likely to freeze

on annual bases, however they warned that a larger data set should be used in

58

further studies considering a larger span of time, in order to identify potential long-‐

term risks associated with temperature fluctuations.

CHART 2 -‐ Seasonal Fluctuations of Surface Water Salinity Gradients (PSU) at the Kosterfjorden in 2012 [Depths (D) of 0, 5, 10 and 20m]. Source: SMHI (2013)

Chart 2 displays the salinity fluctuations for the year 2012, at depths of 0, 5, 10 and

20 meters. Several trends are observable here. First it is clear that the highest

salinity values are at lower depths, while surface waters are somewhat more diluted

by freshwater. This indicates that the highly saline Atlantic water mass is situated

below a more brackish Baltic water mass at the surface, diluted by a combined fresh

water input of rivers, lakes, surface currents and precipitation. A second observable

trend is that there is no pronounced seasonal oscillation of salinity; at each depth,

salinity remains more or less constant throughout the year. The third trend of note

is that, like for temperature, the fluctuations in salinity are more pronounced

amongst surface waters (range of almost 10 PSU, from a high of 27.6 PSU in

September to a low of 18.6 PSU in March), and become more stable with depth

(range of approximately 5 PSU, from a high of 32.9 PSU in November to a low of 27.6

PSU in March).

59

This information kindled concern in both experts. Lars Brunner was of the opinion

that the salinity levels were particularly low and would be a major limiting factor in

the metabolic growth rates of seaweed. He commented that a generally accepted

minimum is usually said to be around 15 PSU. Similarly, Stephen Cross warned

against low salinity, however he has visited successful cultivation site with even

lower salinity of surface waters. The trick, he explained, was to rig the seaweeds on

a cultivation system that can be lowered to greater depths when surface waters are

beyond the survival thresholds of the most vulnerable species. Such a system is

more costly than a fixed line system, and requires relatively advanced engineering

knowledge of such cultivation systems, however it is a challenge that has already

been overcome at other cultivation sites in Canada.

CHART 3 – Seasonal Fluctuations of Nitrate (mgL-‐1 ) and Ammonium (mgL-‐1 ) Gradients at the Kosterfjorden in 2012 [Depths (D) of 0, 5 and 10m]. Source: SMHI (2013)

CHART 4 -‐ Seasonal Fluctuations of Nitrite (mgL-‐1) and Phosphate (mgL-‐1) Gradients at the Kosterfjorden in 2012 [Depths (D) of 0, 5 and 10m]. Source: SMHI (2013)

60

Charts 3 and 4 represent the nutrient concentration gradient fluctuations for the

year 2012, at depths of 0, 5 and 10m. The major trend of note is a seasonal

oscillation of all the nutrients, which seem to increase steadily in the autumn to

high’s in the winter, and then decrease rapidly in the spring to very low or absent

levels for most of the spring and summer. The exception is perhaps ammonium,

which seems to fluctuate more readily displaying independence to the seasonal

oscillations trend of the other nutrients, most notably in the surface waters.

With regard to nutrient levels, Stephen Cross explained he had few comments to

make given that his experience lies principally in IMTA cultivations, and as such the

cultivation sites he is familiar with are not characterised by seasonal variations, but

by steady stream of nutrients from the finfish cultures. Lars Brunner on the other

hand had plenty of comments to make. According to him the nutrient levels seemed

quite tolerable, although the lows seem particularly strong as well as long lasting

(over 4 months). He explained that usually seaweeds have plenty of nutrients

available in the winter but not enough light, which limits growth. Then light

intensity begins to increase in the spring, raising metabolic rates. This period of time

is when growth rates are highest, and other species such as plankton strip the

waters of nutrients very quickly, leading to the summer lows. Thereafter the

61

limiting factors are reversed in the summer for seaweeds, as light intensity is

prevalent but there is a scarcity of nutrients.

5.1.2. Assigning values to products

As presented in section 3.1.3 of the literature review, generally speaking there are

four major categories of products in development or in resale, these being food,

phycocolloids, phyco-‐supplements and biofuel feedstocks. Each of these have

potential revenue streams, or profit potential (PP), that will be considered hereafter.

Furthermore each of these product categories also have different required seaweed

inputs (RSI), that is to say different volumes of seaweeds required for operational

viability. Assigned according to literature, available data and interview discussions,

PP and RSI are qualitatively assigned hereafter according to the following scale: low,

medium, high.

Currently the largest profits from seaweeds are generated from the Asian market for

sea vegetables, worth US$ 5.29 billion in 2004 (Chopin and Sawhney, 2009). In

Europe seaweeds are not a dietary staple and are not sought after to the same

extent, though there is a small demand for high quality sea vegetables and the

European market is growing. The cost of processing sea vegetables is very low, they

are light and cheap to transport. Overall therefore, the generalised PP for sea

vegetables will be assumed as being ‘medium-‐high’, while RSI is assumed to be

‘medium’.

Phycocolloids are the second biggest player in the global market, worth

approximately US$ 650 million in 2004 (Chopin and Sawhney, 2009). Depending on

the quality of the end product phycocolloids can either be cheap or expensive to

extract, however their market price reflects these costs, balancing revenues with

expenses. The difficulty with introducing phycocolloids as a substantial product in

the SEAFARM scenarios is that the European market is already virtually saturated,

62

and thus any serious profit to be generated by phycocolloids will need to be price

and quality competitive with existing industries (FAO, 2003). As such the

generalised PP for phycocolloids was assigned as being ‘medium-‐low’, primarily due

to market saturation, but also due to the requirement of significant investment to

become competitive with existing phycocolloid suppliers. RSI was allocated a

‘medium-‐low’ volume rating.

Phyco-‐supplements are not only on the rise in terms of demand but also diversity.

New innovative products are emerging, as are high value compounds destined for

use in high-‐value/low-‐volume industries such as the cosmetic, neutraceutic or

pharmaceutic products specified in table 3. The diversity of this category of

products, which range from high-‐value/low-‐volume specialist compounds to low-‐

value/high-‐volume soil additives, must be considered and included in the PP and

RSI estimates; i.e. consider the difference between the small volumes of seaweed

required to make high value compounds sold per gram, and the vast volumes

utilised to sell soil additives by the kilo. On the whole, however, there is room for

significant growth of the phyco-‐supplements category notably through research in

blue biotechnology; both interviewees and reviewed literature suggest there is a

‘high’ PP for for this sector, with a probable increase to ‘very high’ in the near future.

The RSI volume had to be assigned as ‘low-‐high’ in order to reflect variation in the

product category.

The fourth and last category of products, biofuels generated from seaweeds, is also

on the rise and of particular interest to industry as this is the sector seen as having

highest profit potential in the near future (ETC Group, 2010). As we have seen in the

literature review, bioethanol and biodiesel derived from seaweeds are looking

promising but still very much embedded in research, while biogas is rapidly moving

toward development and at the tipping point of being profitable. That said, the

temporal context for these scenarios is the present to five years from now

(SEAFARM duration) and thus the PP for biofuels must held in that time frame.

Based on the information gathered in the literature reviews and discussions in the

63

interviews, the generalised PP will be limited to biogas only and will be set as

‘medium-‐low’ with potential to increase in the coming years, while the RSI will be

set as ‘high-‐very high’ to reflect the need for economies of scale to tip the balance

sheet toward a profitable direction.

Table 5 – Summary of market status and qualitatively assigned PP and RSI, by

product category.

Product category Profit potential, PP (low-‐medium-‐high)

Required seaweed input, RSI (low-‐medium-‐high)

European market prospects

Food/sea vegetables Medium -‐ high Medium Low, improving slowly

Phycocolloids Medium -‐ low Medium Stagnating, highly competitive

Phyco-‐supplements High Low -‐ High Good and rapidly improving

Biogas from seaweed

Medium -‐ low High -‐ very high Promising

To summarise this section, table 5 above presents the PP and RSI for each product

category selected in section 3.1.3, motivated in the preceding section. Figure 5

below further helps to visualise this information, inspired from Bruton et al. (2009)

and adapted from the Value Pyramid for algae-‐based products, described by Smith &

Higson (2012). The above PP and RSI values will hereafter be used in the scenario

design section, justifying potential profitability of different operational scales,

product diversities and cultivation types.

64

Figure 5 – Value pyramid for algae-‐based products. Adapted sources: Bruton et al. (2009); Smith & Higson (2013)

In addition to revenues from algae-‐based products, revenues can be generated from

the finfish, invertebrate and shellfish aquacultures intrinsic to an IMTA. These are

well-‐established industries, however the seasonal and sustainable production of

fresh, local foods could be highly lucrative as seen in the economic assessments of

Ridler et al. (2007) and Nobre et al. (2010). Furthermore the cross-‐fertilisation of

trophic levels can be expected to improve harvest yields.

5.1.3. SEAFARM research objectives

As presented in the introduction (section 1.2) and in the SEAFARM research

proposal (Gröndahl, 2013), SEAFARM has five FAs. Crucial to the scenario context is

that the SEAFARM cultivation operations must not only cater for, but be designed to

maximise research opportunities in the five FAs. Hereafter is a reminder of each FA,

and a brief explanation of how the different scenarios might affect that particular

research objective.

V. H

igh

LOW

MEDIUM

HIGH

RSI (Volume)

Mar

ket V

alue

Biofuel feedstockSoil additives

Feed

Sea vegetables

Luxury foods

Phycocolloids

Neutraceutics

Industrial chemicals

Cosmetics

Pharmaceutics

Speciality products

Hig

h

Med

ium

Low

Phyco-supplem

ents

Food / Sea vegetables

65

FA1. Sustainable seaweed cultivation on the Swedish west coast.

Sustainable aquaculture research today is very much oriented toward the potential

benefits of IMTA aquacultures over traditional mono-‐trophic methods. A sustainable

seaweed cultivation is further interpreted in the scenario context as being an

aquaculture whose operations can sustain themselves in the long-‐term: it must

therefore be free of significant impacts on the environment; it must provide

valuable renewable harvests every year; and it must yield a source of income that

can grow over time.

FA2. Seaweed biomass pre-‐processing and preservation strategies.

The scenarios must be designed to cater for opportunities to research and develop

new strategies and techniques for the pre-‐processing and preservation of seaweed

biomass, prior to anaerobic digestion and/or biorefining. As such, samples must be

readily available for harvest in proximity to wet and dry labs in order for conditions

to favour efficient research for this FA.

FA3. Map out biotechnology potential of local seaweeds, then design and

demonstrate the viability of a large-‐scale biorefinery capable of recovering

valuable phyco-‐products.

The aquacultures must be able to provide sample specimens of the highest quality

throughout the growing season, and regular harvests should be made in order to

map out changes to the internal composition of seaweeds throughout their life

cycles. Opportunities could also emerge from the biotechnological mapping of red

and green seaweeds, and species from other trophic levels, for instance of sea

cucumbers or fish.

FA4. Optimise the potential of biorefinery residues to produce biofertiliser and

biogas.

66

The aquaculture must support the best possible conditions to explore and develop

an economically viable supply-‐chain for the AD of seaweed biomass to biogas. Large

scale would be ideal as it would answer some questions relating to economies of

scale, however a small scale cultivation would supply specimens for the continued

development of improved AD techniques.

FA5. Develop a suite of sustainability assessment tools for the whole of the

above processes: cultivation, harvesting, pre-‐treatment, preservation,

biorefining and waste recovery of seaweed biomass.

Once again, the development of sustainability assessment tools is not likely to be

affected by cultivation type. The results of sustainability assessments will certainly

vary according to different cultivation scenarios, but the development of these

assessment tools will not be impacted.

As explained here above, the key FAs likely to be affected by the different cultivation

scenarios are FA1-‐4. These FAs will be included in the scenario matrix of section 5.3

and will help to grade the performance of each scenario.

5.1.4. Socio-‐ and techno-‐economic context

This section looks toward the socio and techno-‐economic context of the SEAFARM

scenarios. Licensing, the location, public attitude, infrastructure required, etc…

One of the biggest challenges faced by any aquaculture, is obtaining a marine

license. As seen in the BioMara case study, this was an unforeseen barrier and the

most significant project setback. Licenses can be very difficult to obtain, notably due

to a lack of evidence as to the impacts of large-‐scale seaweed cultivations, the multi-‐

use nature of nearshore areas, and a “not-‐in-‐my-‐back-‐yard” resistance to any change

67

amongst local populace. There are few seaweed aquaculture of significant scale in

Swedish waters, only small-‐scale pilot facilities for research purposes. As such it

could be expected that the application for the marine license to develop a nearshore,

large-‐ or small-‐scale facility will be complicated and lengthy, as it will be the first of

its kind. Rather than following a set of pre-‐determined marine licensing

instructions, it is likely the process will be of mutual discovery for all parties

involved.

At this point it is suitable to bear in mind that at the time of the writing of this

report, the SEAFARM project remains in the starting blocks, pending funding and

purely theoretical. No practical decisions have yet been made with regards to the

specific location of the cultivation site, nor has a time plan been developed. These

act as major limitations to the accuracy of the scenario context. The Swedish west

coast is a major destination for summer holidaymakers, most notably this area, and

it can be expected that the licensing process will be heavily encumbered by public

opinion and the multi-‐use condition of the area. It will be imperative that the site be

sufficiently discrete so as not to affect views, while also avoiding conflicting

interests with local fishermen, shipping routes and recreational activities. As such it

can be hypothesised that the smaller the cultivation, the less likely it will be for

conflict to emerge. Some opinion surveys have already been conducted in Canada, as

noted in section 3.3.3. It would seem that the public generally favours the

development of IMTA over traditional aquacultures, however some form of

community awareness program would need to be undertaken, or at the very least a

survey, in order to determine local opinion and resistance to the SEAFARM

cultivation.

From a technological perspective, the aquaculture infrastructure will necessarily

need to be adapted to the local area and specific requirements lain down by the

licensing authorities. For instance, it can be expected that the infrastructure will be

required to be removable (non-‐permanent) and discrete in appearance but not

hazardously so (submerged but clearly marked to avoid accidents, notably by night).

68

Either way, it must be expected that the lack of experience of Swedish marine

licensing authorities relating to IMTAs and seaweed cultivations will slow the

process of development and potentially amount to unforeseen costs.

5.2. SCENARIO DESIGN

The following section will present two alternative scenarios for the development of

the SEAFARM project. The goal of this section is to envision (describe) alternative

end-‐states for the cultivation system, thereafter considering each in the scenario

context established in the previous section 5.1. The multi-‐dimensional context

involves four principal aspects: Kosterfjorden growth conditions, potential revenue

streams, the SEAFARM research objectives, and finally, some additional

assumptions on socio-‐ and techno-‐economic aspects as well as some consideration

of impacts on the local environment. These four context aspects will be split into a

series of criteria within a table inspired by decision matrixes, enabling the full

picture of each scenario to be studied pragmatically and presented succinctly. In

essence the answer to three questions is investigated:

a) What would each scenario look like?

b) How is each scenario optimised to fit into the scenario context?

c) Which of the two scenarios represents the more suitable course for the

SEAFARM project to base itself on?

a) and b) will be addressed in the description of scenario ONE and TWO in section

5.2.1 and 5.2.2, respectively, in parallel to the analysis of c). The analysis will be

recapitulated in table 6 of section 5.3.

5.2.1. Scenario ONE – A Biofuel Optimised Aquaculture

69

Scenario ONE describes a cultivation characterised by the ambition of achieving

economic viability within a 5-‐year timeframe, primarily from the large-‐scale

cultivation of local kelp species for conversion to biofuels, and other large volume

kelp products such as fertilisers and feed. In consequent, research conditions should

be optimised for FA2 and FA4, while also delivering capabilities for the provision of

seaweed specimens that can be analysed by partner institutions involved with FA3.

The large-‐scale mono-‐trophic nature of scenario ONE will not contribute to

vanguard aquaculture research. This scenario draws heavily from the work

undertaken as part of the BioMara initiative, notably the techno-‐economic

assessment work undertaken by Dave et al. (2013) as well as the interviews held

with Michele Stanley and Lars Brunner. Ultimately a mono-‐trophic cultivation, it

could be argued that this scenario is not optimised for FA1 and that forefront

aquaculture research on IMTAs will not be taking place. A map of the Kosterfjorden

area has been provided in Appendix C to give an indication of the scale and of what

scenario ONE may look like. Hereafter some further details are provided for

subsequent comparison with scenario TWO.

As Dave et al (2013) suggest, along with several other reports (Bruton et al., 2009;

James and Postlethwaite, 2012), it is still unclear if a biofuel-‐oriented aquaculture

can reach a state of economic viability. The profit margins are still too tight and the

risks too great. It is expected that by scaling-‐up however, economies of scale could

be achieved that will favour a positive balance sheet. Also costs and prices vary

depending on where the aquaculture is located: on the west coast of Sweden biogas

may have a much lower market price than in the Scottish Hebrides, making

economic viability more achievable in Scotland given the higher market value of the

end product. Furthermore this scenario’s economy would have added revenues

from large volume kelp products such as supplements for animal feeds and soils, as

well as a limited amount of local sea vegetables. The major concern of this scenario

is that such a large-‐scale cultivation could be met with public resistance, hampering

efforts for a smooth licencing process.

70

Questions of process optimisation, more efficient anaerobic digestion year-‐round,

pretreatment and storage are still largely unresolved, however according to Schlarb-‐

Ridley and Parker (2013) it is expected that within a 5-‐10 year time frame, advances

in cultivation technology will render AD of macroalgae feedstocks commercially

viable. Lewis et al. (2011) specifically suggest that the cost of AD feedstocks must be

reduced to £125-‐300 per dry tonne in order for operations to break even under

existing market conditions. Another strong argument for AD reaching economic

viability is that the cost of natural gas and fossil fuels as a whole is steadily

increasing, and the more these prices rise, the more lucrative opportunities in AD

will become. In the present however, the ability to project profits from AD alone

remains limited.

The mono-‐trophic nature of scenario ONE is also a key limitation. As will be

explained in the description of scenario TWO, certain key synergies induced through

multi-‐trophic integration will not be capitalised upon. In relative terms therefore it

can be expected there will be a reduced resilience to disease and market price

fluctuations, shifts in environmental conditions (nutrient striping) resulting in

growth limitations, and added vulnerability from the limitation to a single revenue

stream. The extent of these relative shortcomings will be clarified in the description

of scenario TWO in the following section.

5.2.2. Scenario TWO – A Small-‐Scale Diversified IMTA

Scenario TWO describes an IMTA cultivation designed to cater for a wide range of

local species to subsequently identify those that hold the greatest PP and exploit

them within the 5-‐year timeframe. The contrast with scenario ONE lies

predominantly in the IMTA approach. With regards to the SEAFARM research

objectives, scenario TWO should perform better relative to scenario ONE, with the

author weighting each FA with an ‘optimised’ status, as motivated hereafter, except

for FA4.

71

High expectations are accorded to FA1 as the IMTA approach is now widely

accepted to be the most advanced form of aquaculture and is currently the subject of

intensive research. FA2 is neither hampered nor favoured by the IMTA approach,

thus having the same weight as in scenario ONE. The research conditions for FA3

are also considered to be optimum through the vast range of species that will be

subjected to biotechnology research and development of biorefinery processes. FA4

is rated as limited relative to the other scenario, due to the small cultivation, thus it

will not act as a large-‐scale pilot cultivation. Finally, the development of a suite of

sustainability assessment tools (FA5) should be unaffected by the differences

between scenarios ONE and TWO. A map for scenario TWO has also been provided

in appendix C to illustrate the scale of operations, and to demonstrate what it might

look like.

The cultivation infrastructure is expected to be more costly and complex per m2

however the cost of its installation should more or less match that of scenario ONE

given the smaller scale of operations. Furthermore, one of the greatest assets of an

IMTA approach is the cross-‐species fertilisation, which should help to maximise

growth rates during the summer when natural nutrient availability will be low for

scenario ONE, thus relatively improving yields, but also nurturing synergies of

disease resistance and environmental benefits.

The expected revenues of scenario TWO are much more diverse, coming from all

four categories of phyco-‐products outlined and motivated in section 5.1.2. Based on

the assumption that a diverse economy is more resilient, scenario TWO is also

favoured as being build on a more solid economic foundation than scenario ONE,

with multiple avenues of future development rather than being restricted to an

income from biogas related options. Indeed in the short term, profits could be

drawn from readily established markets and extraction processes, such as the

fractioning of omega 3 and β-‐carotene, or the sale of sea vegetables and

72

phycocolloids. Each of these markets could participate toward a greater whole,

while nurturing a more diverse set of key skills for the team of Swedish researchers.

Finally, research by Ridler et al. (2007) suggested that public stakeholders can be

more accepting of an IMTA cultivation over a more traditional aquaculture, while

the small-‐scale of operations relative to scenario ONE should also reduce the

likelihood of public resistance and opposition to marine licensing.

5.3. SCENARIO MATRIX RESULTS

The following table 6 presents a summary of the main results, as discussed in the

previous two sections. Scenarios ONE and TWO are played off against each other,

relative to the descriptions, scenario context and discussions held in the Section 5.2,

SEAFARM development scenarios.

73

SCENARIO

)ONE

SCENARIO

)TWO

Limited'to'kelps,''known'for'their'high4energy'contents'in'the'autumn'and'thus'most'suited'to'AD.

All)known)local)species)from

)any)trophic)level.

Long4line'systems'&'long4term'development'of'automated'systems'to'reduce'harvest'costs.

Complex)and)costly)com

bination)of)fish)pens,)benthic)level)cages,)shellfish)cages)and))seaw

eed)longlines)

Limited:'nutrient'stripping'is'expected'in'the'spring,'thus'limiting'growth'in'the'summer.'Further'research'required.'

Enhanced)by)yearDround)fertilisation)through)the)integration)of)different)trophic)levels.)

FA1)D)Sustainable)AquacultureLim

ited:)not)able)to)partake)in)IMTA)research

Optim

ised:)vanguard)IMTA)cultivation)research

FA2)D)Preservation)&)pretreatm

entOptim

ised:)key)and)prioritised)challenge)to)tackle)Optim

ised:)key)challenge)to)tackle

FA3)D)BiorefineryLim

ited:)biotechnology)only)applied)to)macroalgae)specim

ensOptim

ised:)diversity)of)specimens

FA4)D)Biofuel)feedstockOptim

ised:)key)and)prioritised)challenge)to)tackle)Good:)key)challenge)to)tackle,)though)lim

ited)to)a)smaller)cultivation)w

ithout)econom

ies)of)scale

FA5)D)Sustainability)assessment)

toolsUnaffected

Unaffected

Sea)vegetablesMedium

,)limited)to)kelps

Medium

)D)high,)with)increasing)potential)as)the)European)m

arket)slowly)develops

PhycocolloidsNone,)lim

ited)to)kelpsMedium

)D)low,)a)highly)com

petitive)industry)with)a)saturated)m

arket)in)Europe)

PhycoDsupplements

Low,)lim

ited)to)large)volume)products)such)as)soil)conditioners)and)feeds

High,)rapidly)increasing)with)new

)patents)and)innovative)products,)driven)by)blue)biotechnology

Biogas)feedstockMedium

)D)low,)prom

ising)market)conditions)likely)to)im

prove)in)near)future,)but)there)are)still)m

any)risks)and)questions)that)need)answers

Medium

)D)low,)prom

ising)market)conditions)likely)to)im

prove)in)near)future,)but)there)are)still)m

any)risks)and)questions)that)need)answers

Finfish,)invertebrates)&)shellfish

None

High,)well)established)m

arket)and)local)demand)

On)benthic)environm

entLargely'unknown.'Some'impacts'likely'as'a'result'of'cultivation'installations.'Further'research'required.'

Largely)unknown.)Som

e)impacts)likely)as)a)result)of)cultivation)installations.)Further)

research)required.

On)m

arine)wildlife

Largely'unknown,'most'notably'for'marine'mammals'and'local'food'chains.'Further'research'required.

Largely)unknown,)m

ost)notably)for)marine)m

ammals)and)local)food)chains.)Further)

research)required.

Relatively'vulnerable.'Reduced'growth'rates'and'lost'harvests'from'parasitic'and'bacterial'infections'are'common.

Relatively)resistant.)Multiple)species)com

binations)can)(a))provide)back)ups)in)case)of)the)loss)of)a)particular)crop)and)(b))it)m

ay)improve)disease)and)pest)resistance.

Difficulties'with'making'a'large4scale'cultivation'discrete'are'likely'to'result'in'public'resistance'and'setbacks'to'licensing'process.

SmallerDscale)w

ill)reduce)likelihood)of)public)resistance.)IMTA)m

ay)also)help)to)gain)acceptibility.)

Minimal.'Could'be'affected'by'a'multitude'of'factors'such'as'market'price'fluctuations,'diseases'and'bad'harvests.

Enhanced.)A)diversified)product)range)will)im

prove)the)likelihood)of)overcoming)

economic)setbacks)

Economic)resilience

DESCRIPTION)AN

D)CONTEXT

Cultivated)species

Cultivation)infrastructure

Kostefjorden)environmental)grow

th)factors)

SEAFARM)research)support

Public)acceptability

Disease)vulnerability

Cultivation)impacts

Profit)Potential

Table 6 – Summary of results

74

6. CONCLUSION

The recent increase in publications in this field suggests we are entering a golden

age of sustainable marine resource development -‐ and it is an encouraging prospect

that excellence for biotechnology innovation in Sweden can be applied to blue

biotechnology and guarantee future development through the SEAFARM project.

This thesis initially set out to explore some development pathways for the SEAFARM

cultivation, to inform forthcoming decisions and explore potential for the

development of a new marine resource industry in Sweden.

At first the thesis sought to establish some background: the call for the development

of a sustainable European bioeconomy and the Swedish response to this call in the

form of the SEAFARM project. Thereafter the transdisciplinary merging of

biotechnology, aquaculture and bioenergy research was established in the literature

review, further supported by interviews, with notable emphasis on historical trends,

current practises and the necessity of directing future development toward more

productive, sustainable and lucrative pathways. In order to better inform the

subsequent discussion and analysis of development pathways, a case study of the

Scottish/Irish BioMara project was presented, also supported by interviews. Then

the scenario context was established with emphasis on the selected Kosterfjorden

site, SEAFARM research objectives, some potential algae-‐based products and other

techno-‐ and socio-‐economic aspects. Finally, scenarios ONE (a biofuel optimised

aquaculture) and TWO (a small-‐scale diversified IMTA) were described, weighted

and compared within the scenario context.

The results showed that scenario TWO faired better than scenario ONE, most

notably in the pursuit of economic viability. Both scenarios performed well in the

provision for the SEAFARM focus areas, with a slight advantage to scenario TWO in

FA1 regarding the cutting edge IMTA mode of cultivation and FA3 due to the greater

diversity of specimens that would become available to biotechnological scrutiny.

75

With regards to profit potential, the IMTA scenario provided a far more diversified

set of incomes. It is assumed that, although these revenues would not be substantial,

their breadth would form a more resilient and viable economy. Furthermore,

considerable profits could be expected from the additional revenues from IMTA fish,

invertebrate and shellfish components. Improved harvest would be expected from

the cross-‐species fertilisation maximising growth rates during the summer months,

when natural availability of nutrients is lowest but sunlight availability is at its

highest (see charts 3 and 4 of the scenario context). Finally, the IMTA scenario was

also found to hold other advantages over scenario ONE, namely in the smaller scale

facilitating marine licensing, increased odds for public acceptance, and the

hypothetical synergies such as increased resilience to disease and pests. Overall

scenario TWO was found to be a well-‐rounded and better-‐suited end result through

its diversified products and economy, enhanced resilience, smaller-‐scale, vanguard

IMTA approach and its pragmatically tailored approach to the delivery of the

SEAFARM research objectives (FA1-‐5).

6.1. FURTHER RESEARCH

It is still early days for this new industry, and many questions have yet to be

answered. For a full account of these questions, see the roadmap recently published

by Schlarb-‐Ridley and Parker (2013).

With regards to the SEAFARM cultivation, some more specific areas of further

research can be suggested. It is known and accepted that specific species of

seaweeds are highly adaptable to new environments. For instance, a specimen of

Saccharina latissima from the Bay of Fundy in Canada, or from the Scottish

Hebrides, will not be adapted to brackish Baltic conditions of the Kosterfjorden

whereas the specimens that will be cultivated in the SEAFARM project will be.

Although part of the same species, the variation and adaptability within it makes it

76

hard to estimate growth rates and potential yields. Some preliminary experiments

should be conducted to estimate potential yields from the SEAFARM cultivation.

Such information would provide a much stronger basis for the estimation of

potential revenues, than was possible to undertake in this thesis.

As suggested by Michele Stanley, perhaps the greatest challenge for these sorts of

cultivations lie in the marine licensing sector, which in the UK, remains largely

undecided due to a lack of knowledge and evidence regarding environmental

impacts. Further research should therefore be undertaken, not just in the UK but

anywhere prospecting for cultivation sites, as to the potential impacts of cultivations

on benthic environments, as well as local species of fish, mammals, birds, vegetation,

in fact any species present in that area. This should inform decision makers with

regards to the renewal of marine licensing policy, and accelerate the development of

new cultivations.

One of the most discussed forms of value amongst ecologists today, is the value of

ecosystem services (see: Smith and Higson, 2012). As seen in the report by Nobre et

al. (2010), some aquaculture investigations attempt to estimate some values for the

ecosystem services provided by seaweeds. Indeed for scenario ONE, an operational

large scale macroalgae farm on the west coast of Sweden would be extracting vast

amounts of nitrogen and phosphorus from those waters. It could be suggested that a

nutrient credits scheme could be applied, inspired from carbon credits, potentially

adding a significant amount of value to scenario ONE and potentially overall making

it viable. The potential for such nutrient trading schemes should be investigated

urgently and thoroughly in such a context, as it could tip the balance in favour of

scenario ONE, and make it a profitable business enterprise.

77

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8. APPENDIXES

8.1. APPENDIX A – VARIABLES AFFECTING SEAWEED GROWTH RATES

Seven key environmental variables affecting growth, assembled from Gröndahl and Blidberg (2012)

i. Sea action – coastal areas fit for algae can be sheltered as well as exposed to wave action and currents, each offering distinct advantages. Where currents and waves are active the water and fresh nutrients are cycled continuously, however only plants adapted to rough treatment by heavy storms can survive in these conditions. Where an area is sheltered, algae can grow without risk of being torn from their anchorage, however stagnation can cause greater temperature fluctuations, lower nutrient content and exposure to diseases or pests.

ii. Water depth and turbidity – the transparency or turbidity of the water is of vital importance for the growth rates of the algae: murky water will block out some light, reducing available energy to feed photosynthesis, however crystal clear waters provide ideal conditions. Further, water is not fully transparent: it absorbs a portion of light so usually the deeper the habitat, the less light available and thus the lower the growth rates.

iii. Salinity – at a biochemical level, salt is perhaps one of the most important environmental factors for macroalgae. It holds essential roles in metabolic functions and in algal cell biology.

iv. Nutrient availability – like any other plant, if all the essentials for photosynthesis to take place are present, as well as all the nutrients required for growth, the macroalgae will thrive. Where there are high levels of nutrients, it is possible for other organisms such as microalgae to thrive in competition and increase turbidity; however where nutrients are in low concentration, growth rates will be limited. A fine balance must be struck, and where control is not available, careful monitoring of the balance is essential.

v. Unwanted species – competition by organisms such as microalgae can be a big problem as previously established, but so can pests, for instance sea snails.

vi. Bottom type – sea floor typologies vary a lot and play an essential role in determining the type of benthic ecosystem will be present. Rocky bottoms provide anchorage for microalgae, while sandy or muddy bottoms can increase water turbidity as sediments are thrown up in suspension when sea action is elevated. It also affects the costs of mooring systems for eventual macroalgae cultivation.

vii. Anthropogenic uses – some estuaries or coastal areas may be unsuitable for macroalgae farming based on other anthropic uses of the space, such as fishing and tourism, while other spaces may be designated as natural reservations, creating difficulties when applying for construction permits for the necessary infrastructure.

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8.2. APPENDIX B – QUANTIFYING IMTA SYNERGIES Measuring the efficacy of finfish wastes as fertiliser for shellfish and seaweed cultivation The research presented in this paper was conducted off the coast of Chile in Metri bay, using Gracilaria chilensis grown on ropes to reduce eutrophication and use wastes from a salmon cage farm between January and March 1995. Note: no shellfish were involved in this particular experiment, only seaweeds and finfish. Gracilaria was selected for its tried and tested bioremediation abilities (Buschmann et al. 1994). Metri bay has pronounced tides between 5 and 7m of amplitude driving east-‐west tidal currents averaging between 0.03-‐0.12 m/s, with a salinity between 28 and 30 PSU and water temperatures between 8 and 15°C (Toledo and Toro 1985). “Nutrient concentrations in the farm area vary during summer between 0 and 3.6 pM for nitrate, 0.03 and 0.09 FM for phosphate (molybdate reactive phosphate) and 0.7 1 and 2.1 FM for ammonia” (Troell et al. 1997). The established salmon farm species were Oncorhynchus mykiss and Oncorhynchus kisutch and production averaged around 227 metric tons per annum. (Troell et al. 1997)

In order to measure the fertilisation of the G. chilensis, two test sites and a reference site were proposed at different distances from salmon cages: the two test sites, stations A and B, were positioned 10m and 150m respectively to the west of the salmon cages to maximise exposure of algae to the effluents as carried by the currents; the reference site, station C, was positioned approximately 1km away to the south of the fish farm. Each site was identical in terms of the layout of the seaweed: each was composed of 30 bundles of Gracilaria, attached to 3 circular frames (10 bundles per frame, each plant spaced out every 25cm) with a diameter of 80cm. The frames would be fixed at depths 1m, 3m and 5m. Two experiments lasting 2 weeks each would be conducted, one in February and the other in March, with the objectives of (a) measuring specific growth rates, as described in Lobban and Harrison, 1994; (b) analysing agar content expressed as percentage of dry weight according to Cancino and Orellana, 1987; (c) determining levels of total carbon and total nitrogen, by means of a Leco CHN-‐900 elemental analyser; and (d) measuring total phosphorus, as extracted using hydrochloric acid in Aspila et al., 1976. (Troell et al. 1997)

The mean specific growth rates varied from 3 to 7.1% per day between the stations and at different depths. The growth rates were significantly (20-‐40%) higher at station A at all depths and both in February and March, with the highest recorded at 1m depth in February. The growth rates at stations B and C were almost the same, with slight variation and no observable trends. No trends emerged from total N and P content at different depths within each station, however samples at station A showed significantly higher levels of both total N and P content compared to stations B and C. Carbon content varied from 25-‐29mmol C g-‐1 dw-‐1 and no noticeable differences occurred in depth or between stations. Agar content, measured as a percentage of dry weight, ranged between 16.9% and 22.6%, and was

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lowest at station A. However the higher biomass yield at station A resulted in higher levels of total accumulated agar. (Troell et al. 1997)

From the results it is understood that nutrient availability, specifically of N and P, is one of the major limiting factors to the growth rate of Gracilaria chilensis in these waters. Thus where N and P are in higher concentrations (in direct proximity to the salmon cages at station A) growth rates were on average 20-‐40% higher, while N and P content in the algae was also higher. Similar experiments have documented the effects of nutrient availability on macroalgae growth, as well as significantly increased macroalgae growth rates in proximity to coastal finfish cages (Leskinen, 1985; Leskinen et al., 1986; Ruokolahti, 1988; Rijnnberg et al., 1992). (Troell et al. 1997)

Agar content however yielded very different results, as agar content is known to decrease with increasing tissue nitrogen concentrations (DeBoer, 1979): the experiment showed that at station A the agar content was consistently less concentrated than at stations B and C, yet the overall net yield at station A was greater due to the higher biomass yield. This illustrates the complexity of the biological processes governing algae growth and substance content, and it demonstrates that decisions regarding cultivation techniques should be made based on a range of factors, most notably the desired end-‐product. For instance in the above case, if agar were to be the desired end-‐product, then sites B and C might be preferable despite lower net agar yield, because their higher concentrations are cheaper to extract than the more diluted but higher net yield at site A. That said it has been reported that the quality of agar is greater when Gracilaria is grown in proximity to salmon cages (Martinez, 1994), a commercially significant find which adds to the complexity of the decision situation. If however the end product were biomass for biofuels, site A would be preferable given the higher biomass yields per m2 of cultivated sea.

Mussels as a barrier for finfish pathogens In the last few years the sea louse, Lepeophtheirus salmonis, has developed resistance to the drug SLICETM and begun to seriously threaten the cultivation of Atlantic salmon. There are known biological controls, such as several native species of wrasse used in northern Europe (Treasurer 2002) which could participate to a solution, however keeping tiny wrasse in proximity to salmon in sea cages is impractical. Alternatively, researchers hypothesised that the blue mussel may act as a biological control thus reducing infectious pressure if mussels can consume the sea louse in its ineffective copepodid life stage. Thus the authors joined a team of researchers developing an IMTA combining salmon, kelp and mussels in the Bay of Fundy, Canada, with aim of modelling disease dynamics and testing their hypothesis.

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Local mussels were introduced into a closed seawater system maintained at 10°C. Separately, local sea lice were collected from an infected farm and reared to copepodid stage. The lice larvae were stained red, then counted for use in the experiment. 10 beakers of 0.5L of seawater, containing 105 cells/ml algae and 100 copepodids were used. 1 mussel was placed in each beaker and left for 30mins or 60mins. Immediately after removal, the mussel stomach contents were removed, stained copepodids were counted, then contents were processed for DNA isolation. Results show that mussels indeed ingested the copepodids. The number of free swimming copepodids were counted after the removal of the mussels after 30 and 60mins: in the 30min exposure beakers, 87-‐98 remained; in the 60min exposure beakers, 38-‐100 remained. In the 30min exposure mussels, all were found to contain stained copepodids further confirmed by DNA analysis. The 60min exposure mussels all contained copepodids except for one (mussel number 10), also confirmed by DNA analysis. It is thought the exception, mussel number 10, was not feeding at the time of the experiment. Overall it is clear that feeding mussels ingest sea lice copepodids in the controlled conditions of the experiment, however it is not known if they can ingest sufficient amounts to be a practical biological control agent in open water cultivations. Trials are needed to determine their efficacy at sea. IMTA vs. Monoculture in the Bay of Fundy: ten-‐year economic feasibility modelling and public opinion survey In this report two vital questions are addressed. First a model is developed to determine economic feasibility of salmon monoculture versus IMTA; second, industry and public opinion are consulted over the two cultivation practises. The authors modelled the profitability of salmon monoculture versus IMTA, through 3 plausible scenarios. The base-‐model was built from technical data of a salmon farm in the Bay of Fundy, thus replicating expenses and revenues of an established farm of 500’000 smolt. Total costs were estimated at US$1.4 million and revenue would be calculated based on an assumed selling price of fresh salmon at US$2.60 lb. Thereafter the costs and revenues had to be valued for labour, mussels and seaweed farming: for mussels the total 10 year cost was estimated at US$85’000 and for seaweed cultivation it was projected at US$28’000. Revenues and the Net Present Values for all three species were also anticipated. (Ridler et al. 2007) With the base-‐model complete, it was now essential to introduce risks in the form of scenarios, which are detailed in the table below. Risks were assumed to be uncorrelated between species, a plausible assumption as motivated by Ridler et al. (2007:105).

Scenario Salmon Harvest Mortality rates Probability of Occurrence

1 (best) 5 in 10 years 11% at each harvest 20%

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The results from running the model through the scenarios showed that IMTA always results in a higher NPV, motivated by the income from mussels and seaweed that buffer the effects of salmon losses. Principally the results show that one bad salmon harvest can suffocate profits of a salmon monoculture over a ten-‐year period, whereas IMTA provides the diversity of economy to maintain a positive balance sheet and sustain the business. This was further tested in a subsequent re-‐run of the model, this time incorporating market risks subjected in the form of an immediate 12% decrease in salmon market value carried over a ten-‐year run, mimicking a similar price drop in the 1980s (Whitemarsh et al., 2006). Similar to the first results, the IMTA coped better yielding a profit margin of 3.2% compared to 0.3% for the salmon monoculture. (Ridler et al., 2007) Thereafter two opinions surveys were conducted by the authors, in light of the knowledge that public perception can, and has, jeopardized finfish aquaculture in the past (Katrandis et al., 2004); and given the key goal as stated in the Millenium Conference on Aquaculture, that “technological progress in the next millennium has to go hand-‐in-‐hand with social and ethical acceptability” (Pillay, 2001). In essence, social acceptability is seen as an essential prerequisite to sustainable aquaculture. The first random survey of 1220 people took place in New Brunswick, Canada, in 2003, with 110 respondents taking time to answer, of which 53 were from professional organisations or companies and 2 were from environmental NGOs. Overall there was a positive attitude displayed by both public and industry toward salmon monoculture and IMTA, however it was significantly higher for the latter. The former was appreciated for its benefits to the local economy and community employment; the latter even more so due to a trust in science and the development of the latest farming practises, even when the respondent lacked familiarity with IMTA principles. This highlights the fact that although the public trusts that IMTA is ‘better’, a substantial proportion are not interested in the multi-‐trophic nature of the system nor the benefits of such principles. The second survey aimed to identify differences in attitude once IMTA principles have been communicated to respondents, and was conducted in the same locality as the first in 2005. 5 focus groups were held with 23 participants, in the wake of a 12-‐minute video outlining the IMTA pilot project in the Bay of Fundy. All respondents agreed that profit, quality produce and reduced environmental impacts were key to success, and that success should be proportional to sustainability. Areas of uncertainty included the potential of IMTA to reduce disease outbreaks, replenish natural stocks or improve quality. However areas where respondents were most positive included “potential to reduce environmental impacts of salmon farming

2 (worst) 4 in 10 years, with one lost

11% in 4 harvests, 100% in one

40%

3 (intermediate) 5 in 10 years 11% in 4 harvests, 70% in one

40%

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(65%), while improving waste management in aquaculture (100%), employment opportunities (91%), community economies (95%), industry competitiveness (95%), food production (100%) and sustainability of aquaculture overall (73%).” (Ridler et al., 2007:108) Another key find of public perception was that consumers would be willing to consume mussels and algae co-‐cultured in proximity to salmon cages, an issue previously identified as potentially problematic (due to perceptions of increased disease transfer) but hereby disbanded as a non-‐issue (Ridler et al., 2007). Discussions also took place on willingness to pay (WTP) extra for environmentally friendly seafood. Results were as varied as are usually to be expected regarding WTP, but were generally split into three more or less equal groups: one third would pay more willingly, up to 10% extra, particularly restaurateurs; one third were adamant that all seafood should be environmentally friendly, thus there should not be two tiers of price; and the final third were either unwilling to pay more, or simply could not afford to (Ridler et al., 2007). Overall public attitude toward both salmon monoculture and IMTA was positive, with a significant preference toward IMTA based on an overall improvement in sustainability. Consumers disbanded the erstwhile issue of opposition to locally co-‐cultivation of products. And finally WTP discussions for environmentally sound seafood yielded a variety of results, ranging from ‘yes’ to a 10% increase in price, to an outright refusal of environmentally unsustainable seafoods, and ‘no’ from low income families. Abalone monoculture vs. IMTA in South Africa This report is the first detailed economic and environmental comparison between land-‐based IMTA and abalone monoculture systems. The authors based the methodology on a recent modification of the DPSIR framework, the Differential Drivers-‐Pressures-‐State-‐Impact-‐Response (ΔDPSIR) proposed by Nobre, A. (2009) to support sustainable coastal management decision makers. “The aim of the DDPSIR approach is to screen the ecological and economic evolution of an ecosystem during a given time period (Dt) that is relevant from a management perspective (response implementation period). This approach includes an analysis of the drivers, pressures and state before and after the response. The impact on the ecosystem (positive or negative) corresponds to the changes of state during the study period, Dt” (Nobre 2009:186). The specific advantage is that this new approach uses differential values over time and can include the Response (incorporating IMTA), thus providing an informed analysis of change of state, which is particularly relevant to ecosystems and economic components. The details of the methodological procedure of the paper are too lengthy to present in this review, and it was decided to leave them out while recommending the report for detailed instructions.

The case study data applied to the ΔDPSIR is from a South African 240-‐ton year-‐1 abalone farm, Irvine & Johnston Cape Cultured Abalone Pty, Ltd. and aims to

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compare the sustainability of different aquaculture configurations for that case study. The abalone species in question was Haliotis midae, while the integrated component of the two IMTAs was the seaweed Ulva lactuca, selected for this abalone’s affinity for consuming it, its high protein content and for its local availability. In 2007 a downstream U. lactuca culture pond was integrated to the farm to bioremediate part of the effluents and to provide 10% of the farm’s seaweed requirements (abalone consume algae). The farm managers decided to expand the seaweed ponds to supply 30% of the required seaweed in 2009. Thus the three configurations that were input to the ΔDPSIR analysis were the shift from the original monoculture (scheme 1), to the 2007 system (scheme 2), to the 2009 system (scheme 3). (Nobre et al., 2010)

Source: Nobre et al., 2010

The results were formulated according to the DPSIR framework and are summarised hereafter, as the analysis is too extensive and complex to present in full.

• Drivers – first and foremost comes profit, which was estimated to be higher in the IMTA schemes due to a variety of identified synergies and cost reductions, despite higher labour costs.

• Pressures – N and P discharges were reduced by 44% and 23% respectively in the shift from scheme 1 to scheme 2, and further reductions are predicted beyond that. Natural kelp harvesting will also decrease by an estimated 2.2 ha year-‐1 due to in situ production, reducing pressure on those ecosystems. Furthermore the GHG emissions balance indicates a net reduction in emissions relative to scheme 1 of 345 and 268 CO2e year-‐1, mainly from reduction in pumping heights in the new IMTA configurations but also a small amount from seaweed CO2 uptake.

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• State and Impact – the four identified reduced environmental impacts were: reduced N discharge, reduced P discharge, reduced natural kelp harvesting and reduced CO2 emissions. “The quantified environmental externalities [of these reductions] corresponded to an overall economic benefit to the environment and thus to the public, of about 0.9 million and 2.3 million USD year-‐1 upon shifting the farm practice from abalone monoculture (scheme 1) to the IMTA schemes 2 and 3, respectively” (Nobre et al. 2010:123).

• Response: Retrofitting the monoculture and integrating seaweed ponds cost an estimated 12 and 36 thousand USD year-‐1 in schemes 2 and 3, respectively. The estimated immediate financial benefits of increased profits (0.20 and 0.72 million USD year-‐1) were found to recover the implementation costs within the first financial year.

To summarise, the economic and environmental impacts of retrofitting an existing on-‐shore abalone monoculture with seaweeds were estimated using the ΔDPSIR framework. It was found that the costs of the upgrade were far outweighed by the increase in economic return in the first year alone, and that the environmental impacts of the IMTA schemes were much lower than of the monoculture. The IMTA schemes proved both more profitable and more environmentally sustainable.

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8.3. APPENDIX C – MAPS OF KOSTERFJORDEN SITE FOR SCENARIOS ONE AND TWO SCENARIO ONE

SCENARIO TWO

SVEN LOVÉN CENTRE FOR MARINE SCIENCE

Kostefjorden

STRÖMSTADDominant Currents

Shellfish longlines

Seaweed longlines

Fish pens

Key:

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8.4. APPENDIX D – MAP OF AREA, PHOTOGRAPHED DURING STUDY VISIT TO SLCMS

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8.5. APPENDIX E – INTERVIEW TRANSCRIPTS Göran Nylund & Fredrik Gröndahl – Tjärnö – 19th of April 2013 [Discussion has already begun – discussing potential SEAFARM products post-‐refining] Göran – It could be very attractive to look at Polyunsaturated Fatty Acids, Omega 3. Look toward literature for examples of Omega 3 being extracted from different seaweeds. Lets say species A may have a high amount of Omega 3 and it might mean that algal biomass volumes would be reduced. This could be a way to make the farm economically viable. Fredrik – Yes I agree. And with Omega 3, there is already a large market for it and you could get a price for it. Also for the biofuels there is already a market that you can get a price for. Choose a few markets and restrict yourself to them. Then you could look at these scenarios and say, in order to produce biofuels maybe you need huge cultures, but if you make Omega 3 you need maybe less… maybe that could be interesting. JB – [Talking about different markets, food, high value stuff. How do companies get to a profitable state of economy?] Fredrik – First you need to see, how you…. First you put up a farm with certain products and you can make estimates on those revenues. How unprofitable is it to make this farm. Then you look at different production scenarios. If you look at some other product, we could get very profitable with a very small farm. Definietly just a biofuel farm will need a huge area to turn a profit, like this has been done with reeds (PAPER), and that was similar, they wanted to harvest reed to make biogas. We could see these scenarios where it started to be profitable. Something like that is interesting to explore. Like I guess if you build a IMTA, it will be very costly, is it attractive and can it be profitable? JB – [Discuss risks associated with high value extractions, saturation of markets of high value goods] Fredrik – It will be possible to get some production per acre figures from BioMara. Göran – Yes it seems that that is what you need. If you have some figures for the cost of production, the cost will be related to ….. if you have a specific surface area, from that you can calculate things. Those numbers from BioMara could be very good for your basis. It costs so much to collect 10Kg of seaweeds. Then look at the products to see how you can break even.

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Fredrik – If you compare the conditions between here and BioMara there could be some more conclusions or guesses, estimations made. JB – Yes that reminds me is there some data about local water samples that we could use to compare with BioMara. Göran – Yes, SMHI make water samples, just outside the bay here. I will email you those details. Fredrik – another thing to think about is space availability. We did this for Mussels and we found that we used only a tiny amount of space of total coastal areas to produce a huge amount of mussels. Anyway this project will be good. JB – Yeh lots of questions, few answers! Another last quick thing is to do with product diversification again. I wonder about the market potential of species like sea cucumbers and urchins. That could be a good question for your contact at Leroy? Göran – yes I can have a chat with him. JB – Looking back at the document ‘Seaweeds for a biobased Swedish society’ the 3rd focus area is the Environmental Impacts. There seems to be in the literature, an overwhelming assumption that seaweed cultivation has almost no bad impacts, only good from nutrient stripping, which I think is perhaps quite naïve. There must be some bad things… Göran – Potential negative impacts on the area around the harvest, it could affect the benthic organisms. Fredrik – this new book at the conference, it mentions that the advantage of using local species so its not affected by invasive species… Goran – Lunch time!

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Greg Reid, University of New Brunswick – Telephone Interview – 6th of May 2013 JB & Greg– Introductions, explain Seafarm and my project. JB – What is your area of focus in research Greg – The last few years it has been mainly IMTA in the context of Canada, but alsolooking at the system efficiencies, like recovering nutrients, how much is reasonable and practical, so im looking at scales as well. On the East coast we’re looking at the removal of nutrients from Atlantic Salmon, on the West coast other species… Most of the shellfish on the East coast are Blue Mussels, and we are also looking at Sea Cucumbers and Sea Urchins. JB – So your main area is the nutrient uptake role of these species? Greg – Yes, kind of… it also feeds into the economics of the system too, directly or indirectly. Canada and Norway and a few other countries are regulated on the benthic impacts, and out here the main measurement and challenge is to stay below threshold levels of allowed Hydrogen Sulphide. So if you exceed that threshold, you are expected to take mitigative action. In IMTA, hydrogen sulphide release is a function of how much fish poo is getting to the bottom, so if you have cucumbers or urchins down there capable of targeting that waste, then you can stay within the threshold and even increase fish production at that same site without needing to apply for a new site licence, all the while developing new revenues from the urchins and cucumbers. So the economic aspects come through at that level. JB – Are there any specific cultivation sites you are involved with? Greg – I’m involved with all of them. On the East coast here… Well before I get to that you should know that there are 3 basic types of IMTA you should be aware of, of which we have 2 here in Canada. The 1st is where you already have a full scale finfish aquaculture, in this case Atlantic Salmon, and then you are adding on species to the site. So I call that an ADD ON APPROACH. The 2nd is a site which is being custom designed for the purpose of IMTA, and in that case you have more control over the scale, the ratios, and a physical location more appropriate to IMTA with for instance less strong currents. And we have one major one on the west coast, with Black cod. In terms of nutrient uptake, the CUSTOM DESIGNED IMTA will be more effective, but if you are looking for a larger scale IMTA to mitigate aquaculture, then it’s the add on approach. So those are two types of IMTA we have in Canada. The 3rd type is what I call the INCIDENTAL IMTA, and its common in places like China, and even in Spain, where because of the way that site lease areas work, that you already have other species being cultivated in the same area, that through trial

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and error they come up with a functioning system with cross feeding between the different cultivated species. JB – That’s great thanks. Now going back to the species types, are the cultivations you are involved with actively working with S. latissima or L. digitata? Greg – Yes both are involved somewhat here on the East coast. Thierry was also experimenting with another species, I cant remember what though. Heres where the economics come in to play, trying to figure out which market your kelp is going to is how you will determine the scale of operations, how long they need to grow for and when you are going to harvest, etc… Here they are being used for high end products, as opposed to something like a fertilisers. So here we need high quality kelps harvested before there is any form of “frond erosion” (that’s what is sounds like), so out here it goes in the water in November and gets harvested around now, May or June. That’s actually a big thing that gets overlooked quite a bit. Scenario A – you are trying to mop up nutrients and produce lots of kelp, lots of mass, then you lose quality, its going to be damaged and the end product is almost free, totally worthless, something like $10 per ton. But Scenario B – if you keep high quality and you sell it while its still quite small, then its more of a ‘high value specialty rather than a low value commodity’, at least from the economic perspective. It’s a real challenge too to get high volumes of kelp so cheaply, because for every 100t of wet mass you harvest, you can only get about 10-‐15t of dry mass… JB – with regards to the algae at these sites, which of your colleagues is in charge of the seaweed aspects of the cultivations and the high end products? Greg – Well the seaweed person here is Thierry Chopin, and he grows kelp in his lab and deploys them in the East coast, but on the West coast it would be Stephen Cross. So he has found a few market for specialty products, but the amount of kelp grown on an IMTA here is pretty insignificant, and not much of it is grown in Canada when compared to the rest of the world. JB – Water quality comparison with other sites. I’ve been asked to compare with other projects. Is there an agency in Canada that collects water samples or something? Greg – well it depends really. Environment Canada are supposed to be the ones doing that, but I don’t know if they have a database or anything. Depending on what you are looking at… In the East coast, the water quality is good, so are nutrient levels, the oxygen is an issue here especially in the spring with all the melt water from the rivers here. What sort of things to do with the water quality were you thinking of? JB – Well here the concern is salinity.

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Greg – well here it is near a stream that comes, so Stephen Cross has had to deal with salinitiy issues and he may have data on salinitiy tolerance for S. latissima. I know he’s had to drop the cultivation lines to below 5m to saltier waters. JB – Wow very interesting. Ok well the main point of this is to try to learn from others experience, and of course if Stephen Cross has had past encounters with salinity issues it would be in our interest to talk to him about it, and how he overcame it. The other major part of this project is the economics of the project. Are you familiar with the budget sheet of cultivations, or have these cultivation sites been privatised at all? Greg – within the network in Canda we have a big partnership with industry, academia and government, so at the moment the finfish is commercial, they have also taken over the mussels. The kelp is still produced in university labs, and deployed by researchers, you can ask Thierry Chopin about the future plans for that as he is working on commercialisation of it. JB – So which company is in charge with this? Greg – On the East coast COOKE Aquaculture, on the west coast its KYUQUOT SEAFoods. JB – Do you have contacts? Greg – Sure I’ll email those to you now. JB – [Closing chat…]

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Stephen Cross – Telephone Interview – 7th of May 2013 [Introductions] JB -‐ I spoke to Greg Reid yesterday and he mentioned you would be an ideal person to speak to regarding some of the questions I have. As I understand it, IMTA research in Canada is split between the East and West coasts. Which side are you on and what’s your background? Steve – I’m on the West coast, and mine is the only licensed IMTA here. I’ve been studying and researching the principles of IMTA before it was called that, for the last 13 years. I was actually in the room when a DFO [Department of Fisheries and Ocean] spokesperson came up with the IMTA acronym. So in the last 5 years I’ve moved to a truly ‘from the ground up’, designed and tailored IMTA aquaculture, so its not ADD ON. We’ve designed an entirely new production system called ‘SEAfoods’, that’s Sustainable Ecological Aquaculture foods. The reason we’ve given it this new name is because the average consumer doesn’t usually understand the multi trophic concept. I came up with the SEAfoods, and have just published a chapter in the Encyclopedia of Sustainability Science explaining how it is different to IMTA. The main difference is that we try to meet social criteria, as well as the environmental and economic aspects. For instance we only use local species. We also use new types of cages to reduce chemical use to only organic practises, no antibiotics, alternative energies to operate the winches for shellfish for instance, and so on. All in all it’s a much more sustainable way of doing things from a holistic perspective. JB – So SEAfoods is on a higher level than IMTA, in essence going beyond just the cross species and looking at higher order problems that emerge from the application of IMTA. Steve – Yes that’s right. I consider it a new system overall. When we’re finished it will look quite futuristic. From the academic side its easy to sit around and say we need to do this that and the other, but none of them really have a clue what you need from an on the ground perspective. It takes almost the same equipment and resources to grow one line of kelp that it does to grow 70, but the profit margin goes up a hell of a long way between the two. These are the realities on the ground that are often not considered in university offices. JB – This is actually one of the core things I’ve been requested to look into, the economies of scale that can be achieved here. But I have very little to work with, absolutely no numbers from the Swedish project because it is still in the starting block, and again, almost none at all from published papers or conversations I’ve had so far. I think its also to do with the fact that this is still uncharted territory, commercial scale IMTAs haven’t been made operational yet, except those across the continent with your colleague Thierry Chopin.

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Steve – I know exactly what you mean, and because this is all so vanguard, literally the forefront of the technologies, all the investors in these projects have maintained strong proprietary rights over the information and I’m unfortunately not in a position to give you numbers either. Although I can give you some stuff to work with. For instance the biggest cash flow comes from the fish you work with. Fish are the products that offset the cost of installation of the system, so the way we see it, everything else we grow around them is pure profit. That’s a nice way of looking at it. JB – What with the synergies that you are experiencing, in terms of cross species fertilisation? I know of an example in Chile where growth rates have increased up to 50%. Steve – Yep that’s what we’re getting too, between 45 and 50% increase in growth rates in practise. I have a student who is working on a project, he’s taken 40 vertical lines of kelp and placed them downstream of the fish, and over a growing season, he went out every couple of weeks to measure the growth rates of the various kelps and then used GIS to map it all out to look at differential growth. Sure enough the nutrient plume near enough matched the tidal flow conditions, and he was able to map out where the enrichment zone was, as such indicating where you would want to position kelp long lines if you want to do that. JB – Could you tell me the name of the student, I would love to find this paper. Steve – Well he’s just finished the experiment but he’s in the process of writing it up, but I can pop you an email when its ready! And if your professors ever need an international consultant, tell them to give me a ring! […Selling himself!..] JB – Well thanks for all of this, I would like to move on to another area which I’ve prepared a few questions for you about. This is water quality. In essence there is water sample data for the area where the farm here might be located. I sent you some graphs of this data, most notably covering the yearly fluctuations of salinity, temperature and nutrients gradients. Steve – Yes I saw them and had a look. JB – Is there anyone that you could recommend I could talk to regarding these things? Steve – No we don’t bother with nutrient levels because they are so, so low here, hence the whole reason why IMTA was an interesting option for here. What we’ve been focusing on is how we can recycle nutrients based on local currents and dilution patterns. The key for kelp in my mind is knowing the site and it can be different from one to the next, we have 3 sites within 1km of each other and each are very different. One has a seasonal fresh water influence and an associated increase in turbidity. Another has a much stronger ocean influence with much

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higher growth rates. Surface heating is affecting the 3rd site, so we have to grow it at a depth of 5m so that slows down growth too. Overall the big factors are light, salinity, temperature and nutrients, and of course the position in the water column. JB – Ok well what can you tell me looking at the graphs that I sent you? Steve – Well I recon you would need to have the kelp species on a system that can be lowered, because lower salinity can cause big problems for kelps. That way you could drop them if need be. Temperature looked fine and nutrient availability looks decent in the spring but pretty bad in summer, but that shouldn’t matter too much particularly if you have cross species fertilisation going on. What about light penetration? JB – I don’t have much information about that, but I had some conversations with marine biologists on the site, and they mentioned some kelps can grow quite low down. Steve – OK well that sounds good. It probably will do well then. You also have to be concerned about the pollution levels, because they do absorb heavy metals and such, which will reduce the quality of the products depending on what you use them for, particularly food and so on. But another important thing to note is that species of kelps here in Canada are very different to those where you are. Local adaptation to conditions should play a big part, and I’m sure the growth rates of your local species will be different to ours, even in exactly the same conditions. They will have adapted to your environment, there is no doubt there. JB – Ok thanks for that. Well before we wrap up I’d like to talk to you about another aspect. My professor sees two routes to take for economic viability. The first is to go large scale to produce kelp for biogas production, the other is a smaller scale IMTA which is diversified. Can I ask you what you think about those two pathways? Steve – Yes both sound familiar in theory, although the first, as far as I’m aware, is un-‐trialled in practised. For my part I’m familiar with the second option. We deal with high value niche products like fish, sea cucumbers, shell fish, sea urchins, and some kelp for high value products in the west coast markets of California and so on. JB -‐ So in your view pathway two is more realistic at the moment? Steve – Certainly, its not just more realistic, its happening. The 1st I’m not so sure about yet, there is some research coming out at the moment about that and there are a lot of projects trying to iron out the last bits, but as far as I know its not a tried and tested ‘profitable’ venture yet. JB – [Wrapping it up, goodbyes, etc…]

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Per Nehrlund, Leroy AB – Telephone Interview – 14th of May 2013 JB – [Introductions] Hopefully this interview shouldn’t last more than ten minutes or so, I just have some very specific questions regarding algae based products, and the state of the Scandinavian market for them. Per – Ok well perhaps you want to know a bit of my background first. [Background] JB – Great ok well it seems that I am talking to the right person then! Per – I hope I can help. JB – So what is your view, generally speaking, of products that can be derived from algae? Is Leroy AB working with such products? Per – Yes, I am personally involved in the research and development of phyco products, specifically for food. Over the last ten years or so, the European food market has opened up significantly to foreign foods, especially Asian foods. Algae are becoming common on supermarket shelves and Leroy AB has a large part of the distribution share. JB – What sort of products are you talking about here? Per – Well the real money earners seem to be things like the snacks that you can find, vegetarian chips made from kelps and things. Also food supplements and additives are quite important. Raw seaweeds or dried seaweeds are less valuable and not as sought after as other products, but all of them are on the rise. We are also working with high end restaurants, providing different types of seasoning packages, like seaweed flavoured salts and things, which seem to be working quite well too. JB – So you say the market is on the rise… Per – Well yes, it is hard to say how much the market will grow, and how quickly it will grow, but these are products that had to be imported from Asia and by Asian companies ten years ago, but now predominantly it is European based companies bringing them in, or producing them here. Again as I said, there was very little interest in seaweed ten years ago, but certain types of food have become very fashionable. For example, Asian foods, Japanese restaurants etc. Sushi restaurants

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are a big customer for algae, but most Asian food restaurants require some sort of algae, whether its for miso soup, sushi rolls or other more fancy products. JB – Great, can you give me any sort of numbers on the state of the market, how much your sales are in the sector for example? Per – Not at the moment. Most of the information in Leroy AB is proprietary, so I am not free to disclose data to you unfortunately. But if your project kicks of to a start in the next year or so, we could place orders through you for different types of products, and certainly could help you by being a good customer! After that, once we would be in collaboration, Leroy policy would allow for certain exchanges of information, but unfortunately not before. JB – I was kind of expecting to hear something like that. I haven’t been very lucky with obtaining numbers from my interviews, but not to worry! Ok well in my report I have had to simplify certain things in order to make the analysis more manageable. One such thing is that I have had to simplify phyco-‐products into different categories and assign them, generally speaking, some sort of value. What I would like to do now is explain these four categories and discuss in general terms how you feel their values are relative to each other. Per – I can probably help with that. JB – So the first category is sea vegetables, the second is phyco-‐colloids, the third is very broad and is phyco-‐supplements, and the last is biogas from algae. When assigning them relative values, I’m thinking a basic rating of low, medium or high will do. Per – Well first of all I would consider sea vegetables to high value products. You can get quite a good price selling small quantities, but it always must be of high quality. Quality also varies year to year, some might be bad years, others may be very good. It depends on a lot of things. So maybe this would have a medium to high value. I am not sure what you mean by the second one. JB – Well by phyco-‐colloids I mean things like agar agar, or any product that is based on the binding properties or hydrocolloid properties in seaweed compounds. Per – Ok, so this includes food additives and things. Well again this is fairly high value, but the problem for producers is that the market is very saturated, there is a lot of competition. These products values also vary a lot depending on quality, but if we compare it to sea vegetables for example, I would not say it is as lucrative. I would assign it a medium value. Profits will be hard to achieve on a small scale with phyco-‐colloids, because a lot of investment is needed and economies of scale, in order to compete with the big commercial competition.

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JB – Ok that’s great. Now with the third products category, I encompass many different things. It is phyco-‐supplements, so any algae based product that improves the performance of a substance or product, by adding compounds found in algae with advanced properties. Food wise, the only one is food supplements, but the category also includes things like fertilisers, bioactive compounds, pharmaceuticals, etc… Per – Well food supplements are very valuable. Some are quite simple to extract, just dry the seaweed and grind it up, then sell it in tablets with concentrated enzymes, vitamins and minerals as a dietary supplement, for pregnant women for example. There is a big market for this already, but it is growing rapidly. People are becoming more and more concerned about what they eat, and providing the body with nutrients. I would give supplements a high value because they are cheap to produce and sell at a good value-‐added price. JB – I though that would be your answer, but I needed to hear it myself. Any idea about the other products, fertilisers, pharmaceuticals, etc… and also the fourth category, biogas? Per – No, sorry. Again we only work with food products for humans. JB – That’s ok, again I thought so, but there is no harm in asking! Well again this was a short interview, and I was just curious to ask you a few basic questions. But before we wrap it up, I have a few more queries about other seafood products. Per – Yes seafoods is something we work with JB – What about high-‐end products like sea urchins, sea cucumbers, clams, mussels and shellfish? Per – That is something we don’t do much of, but the team I am working with is indeed looking at expanding into this realm. I know there are some really high value products that come from these, or they can be sold fresh to restaurants for a good price. Also the market is growing for these things, and currently most are imported from Asia. We hope to find local producers of these so we can provide local fresh alternatives for the EU market, but I cant give you any values as I’m not sure. But hazarding a guess, I would call them very high value. JB – Great! Well do keep in touch about the developments of these products. If you hear anything at all that you think may be of interest to me, please do get in touch! Also, I may contact you again when I get to my analysis. It was great talking to you and having this brainstorming, and if you don’t mind I will call you again in the coming weeks as things progress on my end.

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Per – Sure that sounds fine to me! Also I will look into these high value products, the fresh seafoods and algaes, and see if there are any numbers I can disclose to you without breaching any rules. [Wrap up, goodbyes, etc…] Michele Stanley, SAMS – Telephone Interview – 15th of May 2013 JB – [Introductory chat] … If BioMara can be seen as a project in reaction to the EU Directive on sustainable sourcing of 10% of transport fuels by 2020, then SEAFARM is a reaction to the call for more research on an EU Bioeconomy. 1st Question for you – When you speak of BioMara today, do you say BioMara IS or BioMara WAS. Has the project itself come to an end, or is it continuing under a different name? M – It’s ongoing, so we are involved in another set of projects, one is ENERGETIC ALGAE. Within that we are v interested in how people are going to keep their stock cultures. Again one thing that came out of BioMara is that people aren’t thinking about how you underpin this hole. What I mean by “stock cultures”, its like your cell lines, so if you take a traditional biotech view of things, if you were growing bacteria or yeast industrially, you would have cultures that have been cryogenically-‐preserved so you’ll have something to go back to, in case of your main culture crashes. This is something which is becoming a bit more relevant with algae because the culture collections are few and far between. Its not always clear how the industry is going to look at this. I do know that Craig Venter has people who runs his culture collection. At Energetic algae we’re very much looking at that is going to underpin a potential algae industry. One thing I have noted that has changed since BioMara is that there has been an expansion from biofuels and bioenergy into biotechnology, to find out what else we can do with algae. JB – That is indeed very true! One of the things that F has asked me to look into is to find a range of products, which could potentially be produced through biotech, and specifically which of these could produce a revenue to sustain a cultivation. SEAFARM will have biotech teams working at institutions across Sweden, notably on the pre-‐treatment and how to store the stuff. M – that is another thing that not a lot of people have given much thought to, the storage aspect. So another project that I’m involved with, AtSeas is actually an SP7

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but its an SME FP7. It’s a textile company from Belgium leading the project, and that’s looking at different surfaces for growing the algae on -‐ because it could be that long lines within a European context aren’t going to be financially viable as you start to try and expand the industry because of labour costs involved. So can you take a textile? Can you seed it more naturally? Can you coppice it? Instead of having to pull it all up to harvest it, can you just cut the seaweed? And how do we store the seaweed? These are all questions we’re looking at today. JB – Great hadn’t thought of the coppicing before, and it makes sense that it would reduce costs dramatically if you didn’t have to use a hatchery for the full cultivation every year… and make the labour less intensive… M – Yep. So that’s one of the problems – if Europe is to compete with the far east, or even with Chile, its going to have to massively reduce costs and look at those things. Those places have very cheap labour costs, whereas here its simply not an option so we need to look at mechanisation options or develop new, less labour intensive ways of cultivating and harvesting. Is there a better way of doing this? How can we reduce our costs? JB – Certainly from a biofuels as the end-‐product perspective costs need to be reduced, unless huge economies of scale are achieved by giant cultivations… but even that is only in theory at the moment, there’s no evidence that it can work yet. But another way of breaking even and improving the balance sheet, and that would be through higher value products. M – So I have another job. I have 2 jobs. I work for one of the research councils here in the UK, so allocating funding to research projects. So I work for Natural Environment Research Council and also the Technology Strategy board. So its sort of research ßà business interface. What we have just done, and this corresponds with micro-‐ and macroalgae, we last year produced a strategic research agenda. So what we needed to do research wise to make algae and established industry within the UK. That’s been expanded out into a road map, which we are launching on the 3rd of June. That having a look at what is achievable in the short and long term. So there’s been an increase in people wanting to eat “sea things” like sea vegetables. There is growing interest in hydrocoidals, but mostly in higher end hydrocoidals. There’s a certain amount of bio-‐prospecting which is needed to identify certain bio-‐actives in seaweed, whether you can couple them into fractioning or thermochemical conversions, and getting products out. One of the partners of BioMara at Dundork was looking at supercritical which was a good way of extracting polyphenols, which can be easily fit into an antioxidant market. The material was dried cheaply, so you would then end up with the issue of storage, but that could then be fed in. So its how you look at it. JB – Ok thank you for that. Lots of things to look into there… So if I’m not mistaken the Lynn of Lorn was the site for the cultivation with BioMara, was it not?

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M – The Lynn of Lorn has kind of been a dead site. We now have our own site which is kind of near by. Its off an Island called Kerrera. So as I said, it was a bit of a dead site, we did an EIA of the Lynn of Lorn, but the Crown Estate still haven’t put any hardware in there. They have their Marince licence, but its still in development stage. JB – Where are the hatcheries? M – So for us its done at SAMS. The hatchery phase is actually very low tech. One thing we’ve gotten into more is gametophytes. Trying to find new ways of doing it and lowering costs. JB – Contact? M – That’s LARS BRUNNER. Lars is very good. And you can also talk to him about cultivation at Kerrera. JB – Cultivation at the Lynn of Lorn M – Well that would be someone at the Crown Estate, so Alex Adrian. JB – There must be some sort of history of the harvests at the Lynn of Lorn? M – No. So let me be clear. We never actually used it as a site. It wasn’t operational. We did do an EIA on the site because then it was suggested we were going to cultivate, but we never did. They didn’t get licences for a long time, and weve had to change sites. We had to beg borrow and steal from all sorts of places. We have our own site only since February, when the hardware went in for the first time and the seaweed the week after that. JB – So its getting somewhere in that sense. M – I think that’s part of the problem, the actual licensing… its actually where the problem is, licensing seaweed farming. Nobody is actually thinking of that, but that will vary from country to country as well. JB – Ok thanks for those answers. Now I made an assumption that you had operations that were active today as leftovers of BioMara, whereby you would have a hatchery, cultivation, harvesting, pretreatment, processing and resale in the form of a supply chain – a wrong assumption. M – Its always very difficult with the funding situations… We do hatchery, ansd we do cultivations, but our project never went beyond the experimental stage. We have been talking to big companies for two years about taking this further, but nothing has happened. There is an [anaerobic digestion] AD plant and a report about using

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seaweed as a feedstock. I can send you that report. So we’re waiting for these other companies to make up their minds… Another thing is we’re in semi-‐competition with a small company looking at fermentation so at the moment when we have material we freeze it and just take what we need. JB – Ok. Biogas digestion was one of the big parts of the project. M – There is actually a paper written on the techno-‐economics of the biogas digestion from seaweeds. It’s very recent. Neil Hewit from BioMara was involved. Its just out in Bio-‐resource technology. First author is Ashok, David. JB – Great I’ll look that up. What were David Ashok or Neil Hewit roles in BioMara? And who would be good for Biogas? M – DA and NH were in charge of the techno-‐economic aspects of the research. A good person to talk to about Biogas would be John Bartlett from “Sliga” (sounds-‐like), although he’s even harder to get a hold of than I am. If you cant get a hold of him, look for his student, 1st name is Carlos* but I cant remember his surname… Someone else is “Paul McCarton from DunDork” JB – Question in terms of water quality at cultivation sites. M – Nave Edwards at Gallway, he is meant to be taking in that kind of information for Energetic Algae. Talk to Nave, I will send you his contact details. JB – Now going back to my thesis, the path I’ve taken so far seems to indicate that economic viability is only achievable, at the moment, through small scale cultivation and high value products… What products are you looking at? M – A range of things anything from food to potential feed for the shellfish industry. It could be that its not necessarily kelps, other types of species are more specialised for products. More effort needs to go into species selection and which species have higher volumes or densities of quality products. JB – Ok, well following from that in terms of product diversification, I’m looking at IMTA. Was IMTA ever looked into for BioMara. M – No because of the way we were funded. You need to make sure you are ticking all the right boxes. You can look at these retail companies though: In Scotland there is a company called Bodayre who are reselling a specific condiment for £8 per 100grams. For that go to www.seaweedproducts.co.uk. Another one is Ocean Harvest who are specialised in terms of animal feed for pigs for instance. Another is SEAHorse who started up providing supplement for race horses.

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JB – So when you set up BioMara you didn’t expect it to end up with operations that could continue when the funding ended? M – No we still had a lot of questions to answer, like storage and pre-‐treatment, and we didn’t think it would take off quite yet. JB – Ok I’m looking at my notes and I think we’ve covered it all. We can wrap it up I guess. If you could send me those links that would be great. Thanks a lot for your time! [Closing chat] *Carlos Vanegas Lars Brunner, SAMS – Telephone Interview – 19th of May 2013 [Introductions] JB – So as I mentioned in our email exchanges, the reason I have asked you to meet with me is that I have been trying to gather some information regarding the achievements and shortcomings of BioMara, but also to discuss different types of IMTA products and growth conditions for kelp species. So first of, can I ask you to let me know a little about your background, how you have been involved with BioMara and what you are now up to in the wake of the BioMara project? Lars – My background is quite long, but basically I have been working at SAMS for some 15 or 20 years now looking at cultivation methods for seaweeds, particularly kelps. For BioMara I was going to lead operations at the cultivation site, however as you now know from Michele, the original site wasn’t granted a marine license. Only recently have we finally been granted permission to set up a site, but this one is on the Northern tip of the outer Hebrides. We finally have our first lines in the water, and we’re due to harvest our first batches of seaweed at the end of the summer. My team still works in close collaboration with Michele Stanley, but it is no longer a part of the BioMara project, although other projects are pending application and we would supply those with samples. JB – Ok, what sort of a cultivation will this be? Are you just focusing on kelp species? Lars – That’s correct, although the integration of multiple species is part of one of the projects we may become a part of in the coming months. JB – What sort of other species would you be bringing onto the site? Lars – A variety, namely fish and shellfish, mimicking the principles of an IMTA style cultivation. I don’t have much of an idea of which species yet, I’ve only read a brief

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memo about these projects. As I said before, my area of expertise is seaweeds so it will be colleagues of mine dealing with the other components. JB – Great, ok. Well can I ask you then some more specific questions about the site. It is called Kerrera, is that correct? Lars – Yes. JB – What would you say the limiting factors, or major challenges to growth at your site are? And do you collect water samples for salinity and nutrient content? Lars – We haven’t begun regular water sampling, but we have undertaken a few surveys yes. Overall we have fairly good conditions here for seaweed growth. Very salty water with a fair bit of current and wave action. It almost never freezes at the surface, although we have some concerns with floating ice blocks that we have to tackle. Also wildlife here is diverse and a bit of an issue. We have lots of marine mammals, birds and big fish to consider during operations, particularly when we install our long-‐line infrastructure. JB – Well that already answered my next question, which was about what sort of infrastructure you are using. Lars – Yes we are using long-‐lines. They are fairly low tech and quite cheap to set up, its not a complicated system, its tried and tested, and I’ve been working with it for years. JB – So back to the limiting factors for growth, what is your major concern? Lars – At Kerrera? I’m not sure yet, but evidently it would seem a lack of nutrient could be problematic. The water is quite clean here in relative terms, very little pollution and plenty of exchange with the sea through strong currents. Yes I think a lack of nutrients would be our major limiting factor. JB – So do you think IMTA will help with that, in theory cross fertilisation between species should help improve nutrient content if the fish cages are carefully positioned. Lars – Indeed this is something we are collaborating with other faculties, particularly with Thierry Chopin in Canada. He is a good person to talk to about that. JB – Yes I have already interviewed one of his colleagues on the Canadian west coast, Steve Cross, as well as Max Troell of the University of Stockholm who has participated on cross-‐species fertilisation research in Chile. Lars – Yes the name rings a bell.

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JB – Ok. Well regarding the cultivation site here on the west coast of Sweden, I have found some water sample data, that I plotted on graphs for you to look at. Did you get my email yesterday? Lars – Yes but I have not had the time to look at them. JB – That’s fine, well I would like you to have a quick look at them now please. The idea here is that you can get an idea of the conditions at the site, and I hope that your expertise can shed some light on the potential challenges for growth we might have. Lars – Well by the looks of it, temperature looks fine although I would recommend checking the data over longer periods of time to check for extreme cold spells. By the looks of it, the samples are collected every month or so. If you look back over the years, missing samples during the winter period are probably due to winter freezes. You need to check long term how likely freezes are because they can damage infrastructure and winter cultivations. Might even be worth trying to call the sample collectors to find out if frozen surface waters are a major concern there. JB – Great thanks for the tip! Lars – With regards to the other factors, nutrients show the classic problem of being in surplus in the winter, being quickly used up in spring by blooms, and remaining at low levels until the autumn/winter. That said the nutrient levels still seem to be alright, with a decent baseline, although they will most certainly be a limiting factor when light is aplenty in the summer months. The salinity gradient chart is also quite interesting. Here salinity is quite pronounced, but your site seems a little on the low side. It may be worth having a long line system that can be lowered to where salinity is greater, in case of sudden drops in salinity which have the potential of ruining a harvest. This would also help solve the problem of the odd surface water freeze. JB – Ok. Do you have any other comments about the graphs? Lars – Not that I can think of now, but If anything else comes to mind I’ll let you know. Overall the conditions seem more or less suitable, particularly if you use species already found in the vicinity. JB – Before wrapping up, I’d like to have a final discussion regarding economic viability. Now I know this isn’t your area of expertise, but as you said before you’ve been working on seaweed cultivation for many years, both in academia and the private sector, so perhaps you can enlighten me. As a part of my report, I have two development scenarios. The first would see a large scale cultivation of kelps only, primarily for the provision of biogas feedstocks. The second scenario would see a much smaller scale IMTA style cultivation, also of local species. In your opinion, which of these two scenarios would be the more achievable?

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Lars – What do you mean by achievable? JB – Well a variety of things: profitable, manageable, costly, etc? Lars – Well mono-‐cultivations are quite easy to set up. The long-‐line technology is simple as chips to organise, the seeding systems that have been developed even in the last few years are very successful, cheap and simple. Once in the water there isn’t much to be done until harvest time, and that isn’t too difficult either. IMTAs however require years of optimisation, constant monitoring and tweaking, and given that the environment is dynamic and ever changing, the system has to be malleable to suit the ever-‐changing conditions. IMTAs aren’t easy to set up either, you have to be aware of currents and so on. That said, the benefits of that can materialise in an IMTA can definitely make the whole process worth doing. To be fair I’m not IMTA expert, though I understand the basics pretty well. I wouldn’t be able to give you much of an indication about economic viability of IMTA systems, but long-‐lines are, as I’ve said before, already well established. JB – So in your opinion the long-‐line is achievable on a large scale? Lars – Yes and No. Yes in terms of the technical aspects, the actual ability for it to be set up. But in practise its hard to get licensing permission for large scale cultivation, particularly in near-‐shore environments. It’s a hard one to answer. Both options have up sides and down sides, I guess it would depend on a variety of other factors, like the market for the products you are aiming for, or the research focus of the projects it would be supplying samples for. JB – Thanks for that. If you don’t mind I may be in touch again soon if anything else comes up! Lars – Sure, just pop me an email and we can set up another phone call. JB – [Wrap up]

TRITA-IM 2013:30

Industrial Ecology,

Royal Institute of Technology

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