Building mutant microbes to produce fuel, eh?
Does it sound saner than drilling for crude oil and natural gas? Perhaps anything, even genetically engineered killer bugs, seems a "better alternative" than the (verified) classical good old gas and oil. Those seaweed-eating mutant bugs will produce ethanol, which is proved to be "a fairly poor choice for motor fuel since it's so volatile and hygroscopic - it spoils quickly. It also has low energy density which is more of an inconvenience (need more to get the same output)."
Seaweed however is a vital part of the planetary ocean's ecosystem. An artificial seaweed eater bug would be a blight upon the seaweed, dooming thousands of species to oblivion. Probably osmotic and pH oceanic conditions won't allow it to take over so (if the microbe gets loose into the wild) we'll be safe from ending up with an ocean of ethanol... (?) But a more preoccupying aspect regarding such a pursuit is about the chemical inefficiency of producing alcohol as a waste product by genetically engineered microbes. The real problem with this type of technology is that it has the ability to damage the oceans through over-harvesting of seaweed.
Until Tesla experimented types of electricity harvesting will become accepted on a large scale by the rulers of the industries, our best bet remains to extract and refine crude oil and to burn natural gas in order to sustain this stage of our civilization.
In the while, should mutant microbes live long enough to turn seaweed into plenty of alcohol to fuel vehicles and industrial processes, the environmental damage would be more disastrous than the worst nightmarish depictions of the bad bad Big Oil. At least crude oil is, well, natural...