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Unlike gasoline, ethanol can be produced from domestic feedstocks, not imported petroleum. Besides being a renewable biofuel, it burns somewhat cleaner compared to gasoline. Critics say that the environmental benefits are nil and more important, the use of biofuels has to compete with use of the same feedstocks for food. As we are already experiencing, this means higher food prices and even food shortages.

In the U.S., ethanol is mostly produced from corn, both land and energy intensive. Experts say there is not enough agricultural land to grow enough corn for both fuel and food. The U.S. Department of Energy says corn-based ethanol provides only 26 percent more energy than required for its production, much being fossil fuels used for fertilizer, diesel for tractors and trucks, and coal and natural gas for operating ethanol plants.

The new Energy Independence and Security Act calls for a dramatic increase in biofuels - from 7.5 billion gallons in 2012 to 36 billion gallons in 2022. Corn- and other grain-based ethanol are expected to account for up to 15 billion gallons of that new standard with 21 billion gallons coming from cellulosic and biomass sources. Since cellulose is present in every plant, there is an abundance of low cost feedstock materials. There is no difference between corn and cellulosic ethanol, both are ethyl alcohol.

Currently, switchgrass is of great interest because of its high levels of cellulose. An acre of grasses, or other crops grown to make ethanol, could produce more than twice the gallons of ethanol compared to corn, partly because the whole plant can be used. It takes 1.2 to 1.3 gallons of fossil fuel to produce one gallon of ethanol from corn. One gallon of fossil fuel can produce over five gallons of ethanol from prairie grasses.

Cellulosic ethanol can also be produced from the estimated nearly 325 million tons of waste materials discarded every year. Wastes like urban wood waste, mill residues, corn stover and wheat straw, and the like could provide as much as 30-percent of our fuel needs.

While cellulosic biomass is cheaper to grow than corn, because it requires less energy, fertilizer, herbicides, etc., it is still substantially more expensive to process into ethanol than corn. Currently, it costs about $2.25 per gallon, about twice as much as from corn. This translates to the equivalent of $120 per barrel of oil. The target is to half this cost by 2012. Plants to produce cellulousic ethanol, at least in demonstration quantities, are coming on line in various location in the U.S. as well as in China and Spain.

Recently, General Motors announced its partnership with Coskata Inc. to use its break-through technology to affordably and efficiently makes ethanol from practically any renewable source, including garbage, old tires and plant waste. It uses microorganisms that eliminate the need for costly pretreatments with enzymes. The microorganisms also ferment the material at lower temperatures and pressures, which reduces operating and infrastructure costs.

The resulting ethanol fuel should cost about $1 a gallon. The process extracts about 7.7 units of energy for every unit spent refining vegetation or feedstock into ethanol. It also reduces CO2 emissions by up to 84 percent compared to gasoline. Coskata's process uses less than a gallon of water to make a gallon of ethanol compared to three gallons or more for other processes.

GM will receive the first ethanol from Coskata's pilot plant in the fourth quarter of 2008, which will be used in testing vehicles at GM's Milford Proving Grounds. The first commercial-scale plant making 50 to 100 million gallons of ethanol will be up and running in 2011.