Bacterial Fuel Cell
Bioengineering is hot. Scientists are looking at how to get bacteria to make electricity, which could open up some very interesting solutions to the 21st Centiry energy crunch.
Bacteria that convert hydrocarbons into power will still vent CO2 of course, but it would be a hell of a lot more efficient than burning the hydrocarbons and trying to capture that heat to boil water to spin a big magnet around to make electricity.
The real mojo would be if someone started engineering a way to get juice from photosynthesis. Biologically-captured solar power is where we get most of our energy (food, oil/coal/natural gas) from anyway. Theoretically it should be possible, but it's a whole different thing to work with plantlife as opposed to bacteria.