A variety of species of green and blue algae from water and soil samples were enriched and isolated. The isolated strains were identified as Chlorella, Nostoc, Chlamydomonas Oscillitoria, Anabaena. Chlorella vulgaris a variant was cultivated under optimal conditions to produce biomass as laboratory as well as the site in both bioreactor and open pond systems. Dried biomass with 10% moisture was tested for calorific value by standard methods and the same were in a range of 3000-3500 kcal per kg. Biomass was subjected to recovery of oils as well as blended with coal and calorific values were 4200 to 5300 KC/KG.