Co-location of algae production facilities with cane sugar mills can be a technically advantageous path towards production of biodiesel. Algal biodiesel production was integrated with cane sugar production in the material and energy balance simulation program Sugars (TM). A model was developed that allowed comparison of production scenarios involving dewatering the algae to 20% ds (dry solids) or 30% ds prior to thermal drying. The net energy ratio, E-R (energy produced/energy consumed) of the proposed process was found to be 1.5. A sensitivity analysis showed that this number ranged from 0.9 to 1.7 when the range of values for oil content, CO2 utilization, oil conversion, and harvest density reported in the literature were evaluated. By utilizing available waste-resources from a 10,000 ton/d cane sugar mill, a 530 ha algae farm can produce 5.8 million L of biodiesel/yr and reduce CO2 emissions of the mill by 15% without the need for fossil fuels. Published by Elsevier Ltd.