Archaean bacterium Credit: Corbis

In talking to ARPAe chief Arun Majumdar last week, I asked him about the future of transportation fuels.

Even with more hybrids and electric vehicles on the road, the U.S. Energy Information Administration says the American driver will rely on liquid fuels for the next 20 years. Corn-based ethanol needs big subsidies and is of dubious environmental benefit.

So to break the stranglehold of foreign oil, scientists and engineers are developing something called electro-fuels. The alternative fuel comes from running a charge of electricity through a solution containing strange microorganisms that feed on harmful ammonia or hydrogen sulfides. The charge induces to the organisms to convert carbon dioxide into the same kind of fuels we use to run our cars.

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These bugs make the conversion without petroleum, biomass or sunlight –- all in an enclosed cell. The DOE is funding 15 labs across the country to find the best electro-fuel solution, and of course at a reasonable cost. Vice President Biden recently gave a nod to Boulder, Colo.-based OPX Biotechnologies, which claims it will produce its first renewable chemical product, BioAcrylic, at lower cost than petro-acrylic with a 75 percent reduction in greenhouse gas emissions. The company's second product is diesel fuel bio-processed from carbon dioxide and hydrogen, according to its website.

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A team at North Carolina State University is combining enzymes from one microbe that grows at 75 degrees Celsius (167 F) with a second one that feeds off hydrogen. This genetic marriage produces precursors to biofuels like ethanol and butanol.

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Majumdar told me only biofuels capture 1 percent of the energy from sunlight, while these new electro-fuels are approaching 100 percent efficiency.

The DOE has been under the gun with a Congressional and Federal investigation into the failure of solar tech Solyndra, as well as planned budget cuts to the very research program that Majumdar is so ecstatic about. It would be too bad if promising research — even high-risk research — gets scuttled by the S.S. Solyndra.