"Whoa, these are kind of spastic."

"Look, that one's a hamburger!"

Biologist Laura Beer and I were bent over a microscope at the Colorado School of Mines, in Golden, checking out a zinging, banging battlefield of single-celled green algae and sunny, UFO-shaped diatoms.

"Oooh, is that the Tetraselmis?"

Ph.D. candidate Jonathan Meuser ambled over from where he'd been isolating mutant algae, and now we all watched as a fat green critter, magnified by 1,000, kicked his little flagella. "Look at that one go," said Laura, a fit blonde in a sleek fleece top. "You could just play here all day."

The environmental-science lab was busy with machines and young, hipster researchers fussing with beakers and vials of neon-bright algae. Prayer flags hung from the ceiling, and a topo map of Mount McKinley took up most of a wall. The scientists were studying algae strains that could turn carbon dioxide into space food and create next-generation biofuels.

Weren't they a little behind the curve? Recent studies have shown that we might as well torch the rainforests ourselves when we fill up with ethanol or biodiesel. One, published by Nature Conservancy regional science director Joe Fargione in the journal Science, calculated that it could take 93 years of reduced emissions from running corn ethanol to make up for the carbon released when grassland is cleared to grow that corn—and 320 years if we cleared rainforest to grow soy for biodiesel.

Oops.

But as I learned in Colorado, that doesn't mean biofuels are dead—quite the opposite. "It's been positive, positive, positive," Meuser said. "Then there's one negative and everyone's like, I knew it! It sucks!" The key, researchers say, is to get our biofuels not from cropland but from organic waste, whether it's turkey feathers, chicken poop, or coal-plant flue gases.

Some of this is low-hanging fruit, the same oil-to-fuel conversion that makes french-fry grease run your live-in school bus. Last fall, a British team called Biotruck crossed the Sahara in a pickup that ran on chocolate waste from a candy factory. And in March, New Zealander Pete Bethune set off from Spain on his second attempt to break the 75-day round-the-world record in Earthrace, a biodiesel powerboat he's run on everything from cruise-ship waste oil to liposuctioned fat—a few ounces off his own skinny frame and 20 pounds donated from two larger friends. ("I cooked it up in a big crayfish pot on the stove," he explained.)

The hopes for more large-scale biomass energy, however, lie in the little "beasties," as one British researcher put it, that digest organic waste, including bacteria that can finish off a meal of sewage or switchgrass with a dainty burp of hydrogen, methane, or ethanol. General Motors has entered into a partnership with a startup called Coskata to let patented microbes turn everything from landfill waste to old tires into ethanol. Researchers at the University of Arkansas have experimented with turning poultry litter—the bedding and droppings under chickens—into biofuel, while British researchers have fed delicious, chewy nougat (more candy!) to bacteria to create hydrogen.