LIHUE » A Hawaii energy company owned by three of the state’s largest landowners has been awarded a $5 million federal grant to develop systems to produce and process biofuels.

The U.S. Department of Energy said today that the award for Hawaii BioEnergy is part of $22 million in investments in projects to develop cheaper algae fuels and make biofuels easier to distribute. Besides Hawaii, grants were awarded in California, Ohio and New Mexico.

The department says Hawaii BioEnergy will use its grant to develop an open pond system to produce algal oil.

Energy Secretary Ernest Moniz said the goal is to make clean energy cost-competitive with gasoline, giving drivers more options.

Hawaii U.S. Sen. Mazie Hirono praised the grant as supporting a project that will help develop clean and efficient energy in Hawaii.

"Hawaii’s renewable energy project and our entrepreneurs are playing a vital role in making our state more energy secure and our economy more sustainable," Hirono said in a statement.

Hawaii BioEnergy is owned by Kamehameha Schools, Grove Farm Company Inc. and Maui Land & Pineapple Company, Inc., which combined own more than 10 percent of the land on Hawaii.

The Energy Department said the grants are part of its goals to drop prices for biofuels by 2017 and algae biofuels by 2022.