Algae harvested from a pilot water quality improvement technology at the Rockaway Wastewater Treatment Facility in New York were examined as a source of carbohydrates and lipids for the production of biofuels. Dried stocks of algae harvested during a 6‐month period were used to feed the bioreactors, and the process to extract sugar from the natural wastewater grown algae was optimized. The length of storage time, storage conditions, sugar extraction process, and fuel production were studied. The results show that if the algae is stored dry (<25% moisture) the algae stock can be used for up to a year with good conversion of carbohydrates to sugars using a 10% w/v of dried algae. These optimized conditions extracted the maximum amount of sugar, which yielded an average of 0.11 (g butanol/g sugar) from the bioreactors year‐round from a wide range of diatoms and other microalgae used to treat wastewater. Similarly, lipids could be obtained from the stored algal with value of >0.015 g/g algae even after a year in storage. These results demonstrate the potential for year round production of fuel from algae harvested as part of a water reclamation process. © 2013 American Institute of Chemical Engineers Environ Prog, 32: 1013–1022, 2013