Algal biomass provides viable third generation feedstock for liquid transportation fuel that does not compete with food crops for cropland. However, fossil energy inputs and intensive water usage diminishes the positive aspects of algal energy production. An integrated renewable energy park (IREP) approach is proposed for aligning renewable energy industries in resource-specific regions in United States for synergistic electricity and liquid biofuel production from algal biomass with net zero carbon emissions. The benefits, challenges and policy needs of this approach are discussed. (C) 2010 Elsevier Ltd. All rights reserved.