Biomass to fuel programs are under research and development worldwide. The largest biomass programs are underway in industrialized countries. In the coming decades, however, developing countries will be responsible for the major increase in transportation fuel demand. Although the lack of existing large‐scale infrastructure and primary resources preclude oil refining in developing countries, this provides an opportunity for the rapid implementation of small‐scale distributed biorefineries to serve multiple communities locally. The principles for biorefinery design, however, are still in their infancy. This review sets a precedent in combining thermodynamic, metabolic, and sustainability analyses for biorefinery design. We exemplify this approach through the design and optimization of a marine biorefinery for an average town in rural India. In this combined model, we include sustainability and legislation factors, intensive macro algae Ulva farming, and metabolic modeling of the biological two‐step conversion of Ulva feedstock by a yeast (Saccharomyces cerevisiae), and then by a bacterium (Escherichia coli), into bioethanol. We hope that the model presented here will be useful in considering practical aspects of biorefinery design. © 2013 Society of Chemical Industry and John Wiley & Sons, Ltd