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Algae-based transportation fuel could reduce global carbon dioxide emissions by over 160 million tonnes, according to the Carbon Trust.

The organisation has set up a funding initiative to boost research and development into algae biofuels with the aim of creating an alternative to fossil fuels by 2020.

It has set up the Algae Biofuels Challenge, which it will fund with up to £6 million and will also have the backing and funding of the Department of Transport.

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