In the shadow of Iceland’s largest geothermal power station, a large warehouse houses a high-tech indoor farm the likes of which I had never seen before.

Glowing panels hum in a strange pinkish-purple glow, and cylindrical columns of water disappear as future microalgae grow.

It’s here that Iceland’s Vaxa Technologies has developed a system that uses energy from a nearby power plant and other resources to grow these tiny aquatic creatures.

“It’s a new way of thinking about food production,” general manager Kristinn Haflidason said as she gave me a tour of the space-age facility.

For most of our history, humans have consumed seaweed, also known as macroalgae.

But its tiny relative, microalgae, has been a less common food source, even though it was eaten for centuries in ancient Mesoamerica and Africa.

Now, scientists and entrepreneurs are increasingly exploring its potential as a nutritious, sustainable food.

The Vaxa factory, located about 35 minutes from the capital Reykjavik, produces microalgae Chlorella, which can be used as both human food and feed for fish and shrimp farming.

It also grows a type of bacteria called Arthospira, also known as blue-green algae because it has similar properties to microalgae.

When dried, it’s called spirulina and is used as a dietary supplement, food ingredient, and bright blue food coloring.

These tiny organisms perform photosynthesis, capturing energy from light to absorb carbon dioxide and release oxygen.

“The algae are consuming carbon dioxide, or converting carbon dioxide into biomass,” Mr Haflidarson explained. “It’s carbon negative.”

Vaxa’s factory has a unique situation.

It’s the only place that combines algae farming with a geothermal power station that provides clean electricity, cold water for farming, hot water for heating, and even pipes to pipe CO2 emissions.

“The final carbon footprint will be slightly negative,” said Asger Munch Smidt-Jensen, food technology advisor at the Danish Technical Institute (DTI), who co-authored a study assessing the environmental impact of Vaxa’s spirulina production.

“We also found that the footprint is relatively low, both in terms of land use and water use.”

Round-the-clock renewable energy, coupled with CO2 flows and nutrients with a low carbon footprint, is needed to ensure the set-up is climate-friendly, which he believes will not be easily replicated.

“Running these photobioreactors requires a large amount of energy input, and the sun must be artificially simulated, so a high-energy light source is required,” he explains.

“My main takeaway is that we should use these low-impact energy regions like Iceland to produce energy-intensive products,” added Mr. Munch Smidt-Jensen.

Back at the algae factory, I climbed onto an elevated platform and was surrounded by noisy modular units called photobioreactors, where thousands of tiny red and blue LED lights replace sunlight to power the growth of microalgae .

They also receive water and nutrients.

“More than 90 percent of photosynthesis occurs within very specific wavelengths of red and blue light,” Mr. Haflidason explained. “We’re just giving them the light they use.”

All conditions are tightly controlled and optimized through machine learning, he added.

Approximately 7% of the crop is harvested each day and quickly replenished with new growth.

Vaxa’s plant can produce up to 150 tons of algae per year, and expansion is planned.

Because these crops are rich in protein, carbohydrates, omega-3s, fatty acids and vitamin B12, Mr Haflidason believes growing microalgae in this way could help address global food insecurity.

Many other companies are betting on the potential of microalgae – a market expected to be worth $25.4bn (£20.5bn) by 2033.

Danish startup Algiecel has been experimenting with portable container-sized modules housing photobioreactors that could connect carbon-emitting industries to capture carbon dioxide while producing food and feed.

Crops are also used in cosmetics, pharmaceuticals, biofuels and plastic alternatives.

Perhaps microalgae could be produced in space, too.

In a project funded by the European Space Agency, the Danish Institute of Technology plans to test whether microalgae can Growing on the International Space Station.

Despite all this investment, there is still a long way to go before microalgae become part of our daily diet.

Mr Munch Smidt-Jensen said it still needed significant development.

He noted the lack of firmness in the texture. Also, if the algae is of the saltwater variety, it may taste “fishy”.

“But there are ways to overcome this,” he added.

There are also social issues.

“Are people ready? How do we make everyone want to eat this?”

Malene Lihme Olsen, a food scientist at the University of Copenhagen who studies microalgae, said more research is needed on its nutritional value.

“Green microalgae (Chlorella) have very strong cell walls, so it’s difficult for us to digest and get all the nutrients,” she said.

For now, she says, microalgae are best added to other “carrier products” such as pasta or bread to improve taste, texture and appearance.

However, Ms. Olson believes microalgae is a promising food of the future.

“If you compare a hectare of soybeans in Brazil and imagine we have a hectare of algae fields, you can produce 15 times more protein (from algae) every year.”

Returning to the factory, I saw an unappetizing green sludge. This is harvested microalgae, with the water squeezed out, ready for further processing.

Mr. Haflidarson let me try it, reluctantly at first, but I tried some and found the taste to be neutral and the texture to be like tofu.

“We’re definitely not suggesting that anyone should eat green sludge,” joked Mr Haflidarson.

Instead, processed algae is an ingredient in everyday foods, with a bakery in Reykjavik making bread from spirulina and a gym putting it into smoothies.

“We’re not going to change what you eat. We’re just going to change the nutritional value of the food you eat,” he said.