LAKE ODESSA, Mich. – A major step toward diversifying U.S. transportation energy supply is as close as the unused corn stalks from this season’s harvest, the waste from lumber mills, native prairie grasses, or even your lawn clippings. These and other non-food plant materials can be cost-effectively turned into cellulosic ethanol, which can greatly reduce oil consumption and global warming at the same time.

In fact, cellulosic ethanol – combined with the billions of gallons of corn-based ethanol already produced today – could potentially replace up to 30 percent of this nation’s demand for energy by the year 2030, according to National Renewable Energy Laboratory. Based on projections from biomass researchers, including Bruce E. Dale, director of the Biomass Conversion Research Laboratory at Michigan State University, cellulosic ethanol could be produced for $1.30 a gallon in the near future and around $1 a gallon by 2020. Both grain-based ethanol and biomass ethanol reduce greenhouse gas emissions -- 29 percent for ethanol and 86 percent for cellulosic ethanol, according to Argonne National Labs.

GM representatives gathered with industry experts and media at the U.S. Bio Woodbury Ethanol Plant to highlight the need for achieving greater energy diversity and to discuss the vital role that both cellulosic and corn-based ethanol can play in transitioning away from oil.

“Biofuels, such as E85 ethanol, gives consumers a real choice at the pump – a choice beyond ‘regular,’ ‘midgrade’ or ‘premium,’ said Tom Stephens, group vice president, GM Global Powertrain and Quality. “We believe that ethanol has the greatest near-term potential to displace petroleum, and that is why we are committed to working with government, academia, and industry to promote both supply and availability.”

“We also support advances in research to commercialize and increase ethanol production through cellulosic energy sources,” Stephens said.

Cellulosic ethanol is non-food based and can be made from a variety of biomass sources, including waste from urban, agricultural and forestry resources. But unlike corn ethanol, the cellulose in the products used to make cellulosic ethanol must be pre-treated and then broken down into sugars before they can be fermented, a step called cellulosis.

Stephens said that based on U.S. Department of Energy projections, the U.S. could produce 90 billion gallons of corn and cellulosic ethanol a year by 2030. This represents 60 billion adjusted energy gallons of fuel. A GM/University of Toronto study supports these estimates.

Professor Dale has been working for more than 30 years on ways to turn cellulose into ethanol. Professor Dale has patented technology for pre-treating biomass for cellulosic ethanol production from corn stover, grasses, wood and other biodegradable material. His pretreatment technology is being scaled up by MBI International ( Lansing, Mich. ) for use in various applications, including an Iowa corn ethanol plant now being adapted for cellulosic ethanol. The plant is one of six facilities partially supported by the U.S. Department of Energy to explore various cellulosic ethanol technologies and raw materials at large scale by next year.

“I like to call cellulosic ethanol ‘grassoline’ because it literally can be made from grass. It is a completely renewable fuel source that reduces our dependence on petroleum,” said Dr. Dale. “Grassoline is domestically produced, environmentally sound and helps support rural and regional economic development.”

According to Dr. Dale, even using World War II-era technology could produce cellulosic ethanol at about $2.50 a gallon. With advanced technologies now being explored in the six cellulosic ethanol plants and elsewhere, he estimates that by 2012 the cost of ethanol production will be nearly halved, to about $1.30 per gallon.

“By 2020 we will be producing tens of billions of gallons of cellulosic ethanol per year for much less than $1 per gallon,” he said.

Gordon Ommen, Chairman and CEO of US BioEnergy, one of the country's largest pure-play ethanol company and owner/operator of the US Bio Woodbury plant in Lake Odessa, Mich., stated, "We believe in the power of the American farmer and we are committed to reducing our country's dependence on oil and the environmental problems that stem from its use. Corn-base ethanol has already contributed to a significant shift in our nation's fuel mix and we believe the best is still to come, both through the expanded use of corn and the development of new technologies that allow for the use of biomass feedstocks. We look forward to being an important part of this exciting future"

Stephens said ethanol plays a key role in GM’s biofuels strategy and will continue to do so. GM has more than 2 million E85 FlexFuel vehicles on the road in all 50 U.S. states –that can run on any combination of gasoline and E85, a fuel comprising 85 percent corn-based ethanol and 15 percent gasoline. GM adds about 400,000 FlexFuel vehicles to the fleet each year and has committed to doubling production of vehicles capable of running on renewable fuels by 2010. GM is also prepared to make fully half of its annual vehicle production bio-fuel capable in 2012 – provided there is ample availability and distribution of E85.

In Brazil, ninety-five percent of GM’s fleet is ethanol capable. In addition, the Saab 9-5 BioPower is Europe ’s top-selling flexible-fuel vehicle.

According to the National Ethanol Vehicle Coalition, there are about 1,200 E85 ethanol fueling stations in the U.S, and that number has doubled since 2006. GM is dedicated to helping to grow the E85 infrastructure in the U.S. Since May 2005, GM has announced partnerships in 13 states to locate more than 250 E85 pumps.

GM believes that advanced powertrain technologies and alternative fuels are key to achieving energy diversity independence. Producing E85 FlexFuel vehicles is one part of GM’s strategy to help reduce the use of petroleum and also reduce vehicle emissions. GM’s strategy also includes improving the efficiency of the traditional internal combustion engine with new technologies; and developing electrically-driven vehicles such as hybrids, plug-in hybrids, fuel cell vehicles and electric, extended-range vehicles.