While ethanol is typically produced from the starch contained in grains such as corn and grain sorghum, it can also be produced from cellulose. Cellulose is the main component of plant cell walls and is the most common organic compound on earth. It is more difficult to break down cellulose to convert it into usable sugars for ethanol production. Yet, making ethanol from cellulose dramatically expands the types and amount of available material for ethanol production. This includes many materials now regarded as wastes requiring disposal, as well as corn stover, rice straw and wood chips or "energy crops" of fast-growing trees and grasses.

Producing ethanol from cellulose promises to greatly increase the volume of fuel ethanol that can be produced in the U.S. and abroad. A report found the land resources in the U.S. are capable of producing a sustainable supply of 1.3 billion tons per year of biomass, and that 1 billion tons of biomass would be sufficient to displace 30 percent or more of the country's present petroleum consumption. With continued advancements in pretreatment technology, fermentation, and collection and storage logistics, the commercial production of cellulose ethanol becomes more economically feasible.

Importantly, it offers tremendous opportunities for new jobs and economic growth outside the traditional "grain belt," with production across the country from locally available resources. Cellulose ethanol production will also provide additional greenhouse gas emissions reductions.

From California to Pennsylvanis, South Dakota to Florida, ethanol producers are rapidly commercializing technologies that utilize cellulose feedstocks.  Building upon the strong foundation grain-based ethanol technology has provided, the ethanol industry is rapidly developing and expanding the number of feedstocks available for ethanol production. 

There are several methods to produce cellulosic ethanol, including enzymatic conversion, acid hydrolysis, gasification, and other technologies.  Click HERE to view schematics of some of these processes.

cellulose provisions in the 2008 Farm Bill

The farm bill, the Food, Conservation and Energy Act of 2008, H.R. 2419, includes a new income tax credit for the producers of cellulosic alcohol and other cellulosic biofuels.  The credit is $1.01 per gallon. If the cellulosic biofuel is ethanol, this amount is reduced by the amount of credit available for alcohol fuels generally (now assumed to be $0.45 per gallon in 2009). The value of the credit, plus the existing small ethanol producer credit and VEETC, cannot exceed $1.01 per gallon. The credit will apply to fuel produced after 2008 and before 2013. 

The bill also includes the Bioenergy Program for Advanced Biofuels (Section 9005):  Establishes the Bioenergy Program for Advanced Biofuels that provides payments to producers to support and expand production for advanced biofuels.

The Biomass Crop Assistance Program (BCAP) (Section 9011):  Establishes the Biomass Crop Assistance Program to encourage biomass production or biomass conversion facility construction with contracts which will enable producers to receive financial assistance for crop establishment costs and annual payments for biomass production.  Producers must be within economically practicable distance from a biomass facility.  It also provides payments to eligible entities to assist with costs for collection, harvest, storage and transportation to a biomass conversion facility. 

For more information on the cellulose provisions of the farm bill, click HERE.

The Energy Independence and Security Act of 2007 (H.R. 6), signed into law in December 2007, contains a number of incentives designed to spur cellulosic ethanol production.

• Establishes definitions for the renewable fuels program, including advanced biofuels and cellulosic biofuels.  Advanced biofuels is renewable fuel other than ethanol derived from corn starch that is derived from renewable biomass, and achieves a 50% greenhouse gas (GHG) emissions reduction requirement. 
• The definition – and the schedule -- of advanced biofuels include two subcategories: cellulose and biomass-based diesel.  Cellulosic biofuels is renewable fuel derived from any cellulose, hemicellulose, or lignin that is derived from renewable biomass, and achieves a 60% GHG emission reduction requirement.  (Cellulosic biofuels that do not meet the 60% threshold, but do meet the 50% threshold, may qualify as an advanced biofuel.) 
• Authorizes $500 million annually for FY08-FY15 for the production of advanced biofuels that have at least an 80% reduction in lifecycle GHG emissions relative to current fuels.
• Authorizes $25 million annually for FY08-FY10 for R&D and commercial application of biofuels production in states with low rates of ethanol and cellulosic ethanol production.

Click HERE for a detailed summary of the cellulose provisions in H.R. 6.

The concept of a biorefinery is modeled after petrochemical refineries, with production of multiple products at a single facility. Existing biorefineries include wet-mill corn processing and pulp and paper mills. As with petrochemical refineries, the vision is that the biorefinery would integrate several conversion processes to produce both transportation fuel (ethanol and biodiesel) and high-value chemicals or products, including ones that would otherwise be made from petroleum. Industrial biorefineries have been identified as the most promising route to the creation of a new domestic biobased industry.

• List of U.S. Cellulosic Ethanol Projects, Under Development and Construction
  Source:  Renewable Fuels Association, January 2009
• Map of U.S. Cellulosic Ethanol Projects, Under Development and Construction
  Source: Renewable Fuels Association, February 2009
• Map: Major DOE Biofuels Project Locations
  Source:  U.S. Department of Energy, October 2008
• Cellulosic Biofuel Producer Tax Credit contained in the 2008 Farm Bill
  Source:  Renewable Fuels Association, 2008    
• New Cellulosic Biomass Ethanol Depreciation Allowance, "50% Depreciation for Cellulosic Biomass Ethanol Plant Property
  Source:  RFA Issue Brief, December 2006
• Summary of the Cellulosic Biofuels Provisions of the Energy Independence and Security Act of 2007
  Source: Renewable Fuels Association
• U.S. Department of Energy's Loan Guarantee Program                      
  http://www.lgprogram.energy.gov/  
• "Net Energy of Cellulosic Ethanol from Switchgrass"                       
  Proceedings of the National Academy of Sciences                                      
  M. R. Schmer, K. P. Vogel, R. B. Mitchell, and R. K. Perrin, November 2007
• "Energy in 2020:  Assessing the Economic Effects of Commercialization of Cellulosic Ethanol"
  U.S. Department of Commerce International Trade Administration,  
  November 2007
• U.S. Department of Energy's Biomass Program
  www.eere.energy.gov/biomass/
• National Renewable Energy Laboratory
  www.nrel.gov/biomass/
• "Biomass as Feedstock for a Bioenergy and Bioproducts Industry: The Technical Feasibility of a Billion-Ton Annual Supply"
  Source: Oak Ridge National Laboratory, April 2005
• "Ethanol from Biomass: America's 21st Century Transportation Fuel"
  Source: Governors' Ethanol Coalition, April 2005
• "Bringing Biofuels to the Pump: An Aggressive Plan for Ending America’s Oil Dependence"
  Source: Natural Resources Defense Council, July 2005