PowerSwitch

Another production unit using closed tanks and the high sunlight levels in Colorado.

http://www.solixbiofuels.com/

and a British press report:
http://business.timesonline.co.uk/tol/b ... 823231.ece

Sounds more promising than some ideas.
It is only another form of solar energy of course, but for transport fuel and the like may prove to more economic than the PV-electricity-hydrogen route.

If Electricity is required , then PV is probably the way forward, but for liquid fuels this may be a partial answer.
Since the algae are grown in tanks the process should not compete with food crops.
High sunlight, low rainfall areas that are unsuited to agrigculture would appear ideal for this system.
I would expect the growing algae to produce oxygen, and in some cases it might be worth capturing this gas for medical or industrial purposes.