Each morning at the UA's Agriculture Experiment Station, pumps push water into shallow basins where the sun can better warm algae growing in it. Each night, the water returns to a canal where the limited surface area helps retain heat.

The production system is intended to maintain the right temperatures for cultivating algae containing oil used to produce biofuels.

This is an example of universities helping make algae a commercially viable crop for Arizona, said Randy Ryan, a University of Arizona researcher who developed the process with a partner.

"We're kind of at this crux of technology," said Ryan, assistant director of the Agriculture Experiment Station. "There's a lot of invention, innovation, ingenuity that's going into how to produce more algae that contains enough oil to make it economically viable, and we're right in the middle of it."

This past summer, UA researchers collaborated with Arizona State University to develop an identical site on ASU's Polytechnic campus. ASU is also home to the Arizona Center for Algae Technology and Innovation, which is dedicated to research that will push biofuel development forward.

Arizona's conditions are ideal for algae growth, with an average of 360 days of sunlight each year, said Peter Waller, Ryan's research partner and also an associate professor. Storing this heat increases the algae's productivity.

While there are some companies involved in algae-based biofuels in Arizona, the role of academic institutions is really to conduct the research, Waller said.

"The universities have expertise in biology and hydraulics and engineering, and so the universities can investigate new technologies and they can look for funding to do that," he said.

Most companies don't have as broad a range of expertise as universities, said Colin Kaltenbach, vice dean of the College of Agriculture and Life Sciences and director of the Agricultural Experiment Station.

"We try to take it from innovation to application, at which point private industry picks it up and takes it to commercialization," he said.

Kaltenbach views the question of making algae viable for mass production in Arizona as both a problem and an opportunity that universities have to deal with before the industry can go anywhere financially.

The ARID project (Arid Raceway Integrated Design) in Tucson was covered by a $4 million federal stimulus grant the university received in 2010 from the National Alliance for Advanced Biofuels and Bioproducts.

Ryan said Arizona isn't seen as an algae biofuels producer just yet by the U.S. Department of Energy, in part because of the perception that water is scarce. That makes funding for such projects harder to come by, he added.

But Ryan said that the perception will become a non-issue if universities work to dispel those stereotypes and establish the base knowledge needed to support algae production here.

"Everybody needs to be addressing all these issues, and then algae becomes a lot more … economically and environmentally promising," he said.