In its push for clean energy sources, President Obama’s administration is exploring all options – including algae-based biofuels.

The U.S. Department of Energy announced Monday that it’s awarding up to $24 million for three research groups to figure out how to make such biofuels commercially viable.

“The United States must find effective ways to hasten the development of technologies for advanced biofuels made from algae and other renewable resources to reduce our need for foreign sources of oil,” Assistant Secretary for Energy Efficiency and Renewable Energy Cathy Zoi said in the announcement.

To help develop non-polluting energy sources, DOE has awarded billions of dollar – much of it from the three-year Recovery Act – for nuclear power plants, solar energy systems, wind turbines, energy efficiency and carbon capture technology.

Obama and Energy Secretary Steven Chu have set aside $800 million in Recovery Act funds to research new biofuels. DOE says algae has potential, but technical and economic challenges remain. To guide future work, it released the National Algal Biofuels Technology Roadmap.

The report says that the Energy Independence and Security Act of 2007 requires transportation fuel sold in the U.S. to contain a minimum of 36 billion gallons of renewable fuels, including biomass-based diesel, by 2022.

It says cellulosic ethanol is expected to play a large role in meeting that target, but “next generation biofuels” such as those derived from algae show “significant promise.”

In a press release, DOE described the three new research projects:

Sustainable Algal Biofuels Consortium (Mesa, AZ) – Led by Arizona State University, this consortium will focus on testing the acceptability of algal biofuels as replacements for petroleum-based fuels. Tasks include investigating biochemical conversion of algae to fuels and products, and analyzing physical chemistry properties of algal fuels and fuel intermediates. (DOE share: up to $6 million)

Consortium for Algal Biofuels Commercialization (San Diego, CA) – Led by the University of California, San Diego, this consortium will concentrate on developing algae as a robust biofuels feedstock. Tasks include investigating new approaches for algal crop protection, algal nutrient utilization and recycling, and developing genetic tools. (DOE funding: up to $9 million)

Cellana, LLC Consortium (Kailua-Kona, HI) – Led by Cellana, LLC, this consortium will examine large-scale production of fuels and feed from microalgae grown in seawater. Tasks include integrating new algal harvesting technologies with pilot-scale cultivation test beds, and developing marine microalgae as animal feed for the aquaculture industry. (DOE funding: up to $9 million)