Please note that Picasa is now known as Google Photos, but you will find all your Picasa content in your Google Photos account. You can create a photo book importing the pictures directly from the Google Photos library, there is no need to download them to your hard drive! You can find step-by-step instructions here.
You can also add the photos from your computer, Instagram, Facebook, Flickr, Google Drive, Dropbox, Gmail, OneDrive, Google Photos, WebDAV, Evernote, Box or take a picture with your camera while creating a PastBook. Keep in mind, that the Filepicker Widget allows importing pictures from multiple sources in one session: while the files are uploading in the background, you can continue browsing and selecting more content.