The former Queensland premier Peter Beattie said on Friday that algae could prove to be the solution to Queensland's clean coal dilemma and put Australia on course for a new future of alternative energy.
At a University of Queensland bioscience seminar, Beattie said Australia would fall behind the rest of the world if the nation did not quickly diversify its energy offerings.
He said attitudes were changing quickly in the U.S. regarding energy usage as President Barack Obama poured money into green research projects.
Beattie cited states that had made massive commitments to reducing their carbon footprint like Hawaii, which wants to use algae to make aviation fuel.
He suggested Queensland scientists should collaborate with American institutes to be part of advances in solar, wind, wave, geothermal and algae-generated energy, saying the latter could provide a lifeline for Queensland's coal stocks.
Research into clean coal so far has focused on trapping carbon in the earth but concerns have been raised that it could leak out.
However, technology could allow carbon created from burning coal to be captured and used to feed algae, getting rid of the storage problem, Beattie said.
Chemical compounds from the algae, which thrives on carbon dioxide, could then be extracted to make diesel or aviation fuel.
"We have to clean up coal because in 20 years, at the very latest, the energy mix is going to be different," he told reporters after his speech.