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Thanks for your candor about not knowing of any longitudinal studies on effects on engines. I wish there were some. I fear that there is a rather tight link between the petroleum and automotive industries...tight enough to make it at least plausible that this very link might make Bosch not approve of alternatives, rather than having actual data. Also, there may be laziness at work: why should Bosch invest anything into actual research? Easier to just disapprove.
While I can agree with the point on Bosch, after all any other fuel requires more testing, I have to disagree on the automotive industry. Especially the US automotovie industry. They are dying, anything they can do that would benefit their image is a good thing. If they are in tight with the oil companies, they need to go ask for a loan because without it they are all dead at the rate they are going. If they could release the fabled 100mpg carberator of urban legend, they'd do it in a second, I guarantee it.
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Now for my main quibble with what you've written, regarding potential benefits of biofuels. As with many scientific studies, there are contradictory results. But I've only seen one study done on biodiesel that showed a net energy loss, and that one was later contradicted rather directly by a U. of Minnesota study: they found a net increase in energy yield of +93% for biodiesel, versus +25% for ethanol. The same study found that biodiesel produced 41% fewer greenhouse gases compared with petrodiesel. From what I understand, they tried to factor in all energy consumption, including fuel for tractors, fertilizers, etc.
There are studies going both ways, just recently the University of Oregon did a major study that demonstrated a huge deficit, it has put the Oregon legislature's plans on hold(I don't have a link right now, sorry). But even assuming it was energy positive, the list I made covered *many* other reasons why its a bad idea, which is why I listed so many potential issues at once. Even if it was an energy positive, even if our engines had zero issues with it, what about the land use, pollution, CO2 increase due to lack of natural forests, etc etc that I listed out? There are too many negatives right now, and no easy answer to them.
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You are also not including the fact that there is actually a fair amount of biodiesel that is made from a recycled product: old restaurant oil. If that source of oil were put under the same test that U. Minn. did, the energy yield could (arguably) be way up from +93%, given that the crop was actually grown for a different initial purpose and would have been produced anyway.
Two problems with the waste argument: 1) It will never be enough to be a major impact since energy use scales pretty lineraly with economic output(ie: we'd never produce enough waste to cover our uses without at the same time creating more need for energy in the process), and 2) Much of the so-called 'waste' is already used for other purposes, like feed, mulch, fertilizer and so on. While its good to use as much of it as possible, its always at best a '2% solution'.
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Like you, I have high hopes for algae-based fuels. And as for fertilizing the algae, the slickest thing I've heard of was an MIT experiment retrofitting a factory with algae-based scrubbers. Previously the factory had failed emissions standards...emitting sulpher, nitrous oxides, and greenhouse gases of various flavors. The algae loved that pollution, and could be periodically harvested and pressed to make oil for biodiesel. The emissions left the scrubbers clean.
I read this as well, Scientific American covered it a few months back. It makes a LOT of sense, if it can be done cost-effectively such scrubbers could be exported to the third world to help control thier CO2 output as well. It will never generate enough power to cover what the factory itself is using of course, but it is a way to reclaim a portion of it while cleaning up the factory's output.
For larger scale algae farms I think we will need to find a way to harvest or redirect farm runoff for its nitrogen content, but thats another discussion.
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