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Ethanol, an alcohol that can be produced from a wide variety of plant materials as feedstocks, is used as a liquid fuel in motor vehicles. At present corn starch and sugarcane are the two main feedstocks used, respectively producing starch- and sugar-based ethanol. Another type of plant material, cellulose, can also be used to produce ethanol, but doing so requires additional processing to break down the cellulosic materials into sugars. Ethanol produced from cellulose is referred to as cellulosic ethanol.
Cellulosic materials, which provide structure to plants, are found in the stems, stalks, and leaves of plants and in the trunks of trees. The abundance of cellulosic materials – roughly 60 to 90 percent of terrestrial biomass by weight – along with the fact that they are not used for food and feed (unlike corn and sugarcane), are key reasons why cellulosic ethanol and other cellulose-based biofuels have attracted scientific and political interest. Cellulose and hemicellulose, which are referred to collectively as cellulosic materials, can be broken down into sugars, which can then be fermented into ethanol. Cellulosic materials being examined for the production of biofuels include those derived from switchgrass, prairie grasses, short rotation woody crops, agricultural residues, and forestry materials and residues.
Ethanol is chemically the same whether it is produced from corn, sugarcane, or cellulose, but the production processes are different and the necessary production technologies are in different stages of development. Corn- and sugar-based ethanol production technologies have been used at commercial scale for decades (see Climate TechBook: Ethanol ). In contrast, some of the technologies needed to produce cellulosic ethanol, an “advanced biofuel” (broadly defined as a biofuel derived from organic materials other than simple sugars, starches, or oils1 ) are quite new. As of mid-2009, no large, commercial-size cellulosic ethanol facilities were in operation in the United States.
The production of ethanol from cellulosic materials is more complicated than the processes employed for starch- or sugar-based ethanol, because the complex cellulose-hemicellulose-lignin structure in which cellulosic materials are found needs to be broken up before fermentation can begin. The cellulosic ethanol conversion process consists of two basic steps: pretreatment and fermentation. This two-step process increases the complexity of, and processing time required for, converting the cellulosic biomass into ethanol, relative to the processes used to convert corn or sugarcane to ethanol.
The type of feedstock and method of pretreatment both influence the amount of ethanol produced. Currently, one dry short ton3  of cellulosic feedstock yields about 60 gallons of ethanol.4  Projected yields with anticipated technological advances are as high as 100 gallons of ethanol per dry short ton of feedstock.5 
Cellulosic ethanol has the potential to provide significant lifecycle GHG reductions compared to petroleum-based gasoline. In addition, the use of cellulosic materials to produce ethanol may yield a variety of other environmental benefits relative to corn-based ethanol.
Table 1: Life-cycle GHG Intensity for Cellulosic Ethanol, based on the California GREET Model9 
|Fuel||Feedstock||CA GREET GHG|
Compared to Gasoline
|Cellulosic Ethanol||Farmed Trees||1.60||98.3%|
|Cellulosic Ethanol||Forest Residues||21.40||77.7%|
|California Gasoline (incl. 10% ethanol)||95.9|
Note: These impacts do not include the impact of indirect land use change on GHG emissions.
The increased complexity and longer processing time associated with producing ethanol from cellulosic materials also makes cellulosic ethanol more expensive to produce than corn- or sugarcane-based ethanol. As of early 2009, no commercial-scale facilities in the United States were producing cellulosic ethanol and costs will remain largely uncertain until the technology is demonstrated at a commercial scale. In 2006, U.S. Department of Energy (DOE) researchers reported achieving a cellulosic ethanol production cost of $2.25 per gallon.12  At this cost, cellulosic ethanol is competitive with petroleum-based gasoline when oil prices are near $120 per barrel.13 
Two key factors that shape the cost of producing cellulosic ethanol are the high capital costs and uncertain feedstock costs.
Table 2: Estimated future costs of cellulosic ethanol and price of oil where ethanol becomes cost-competitive
|Cost of Oil|
|Projected Year||Other Assumptions|
|Wyman, 2007||$0.75||$40||Feedstock accounts for 2/3 of production cost; $50/ton feedstock|
|Hemelinck et al., 2005||$1.50|
|Aden, 2002||$1.00-$1.35||$55-$70||2015-2020||Biomass feedstock cost ~$25-$50/dry short ton|
Sources: Goldemberg, J. (2007). "Ethanol for a Sustainable Energy Future." Science 315(5813): 808-810. Aden, A., M. Ruth, et al. (2002). “Lignocellulosic Biomass to Ethanol Process Design and Economics Utilizing Co-Current Dilute Acid Prehydrolysis and Enzymatic Hydrolysis for Corn Stover.” Other Information: PBD: 1 Jun 2002. Hamelinck, C. N., van Hooijdonk, G., and Faaij, A. P. C. (2005) “Ethanol from Lignocellulosic Biomass: Techno-economic Performance in Short-, Middle-, and Long-term.” Biomass and Bioenergy 28(4): 384-410. Wyman, C. E. (2007). “What is (and is not) Vital to Advancing Cellulosic Ethanol.” TRENDS in Biotechnology 25(4): 153-157.
Cellulosic ethanol is not yet produced at a commercial scale in the United States. Public and private efforts continue to support research on cellulosic ethanol, and technological advances are expected to reduce costs and improve production methods. As of early 2009, no commercial-size cellulosic ethanol facilities were in operation in the United States. However a number of demonstration plants are in operation and a number of commercial-size facilities are expected to begin production by 2011.16  In 2007, the DOE funded six facilities with annual plant production goals ranging from 11.4 million to 40 million gallons of cellulosic ethanol.17  Although two of the funded companies canceled their plans to move forward due to economic difficulties, the remaining four companies intend to begin production by 2010-2011 and, together, produce a minimum of 70 million gallons of cellulosic ethanol per year. In 2007, the National Academy of Sciences found that the United States, using currently available crop residues as a feedstock, could produce about 10 billion gallons of cellulosic ethanol per year. This value assumes a production yield of 60 gallons of cellulosic ethanol per dry short ton, requiring the use of 160 million dry short tons of crop residues. If technological improvements increase production yields to 90 gallons per dry short ton, as some studies expect, annual production volumes could be about 14 billion gallons of cellulosic ethanol per year.18 
In addition to production of ethanol, cellulosic materials are also being examined as a way to produce other biomass-based substitutes for existing fossil fuels (e.g., gasoline, diesel, and jet fuel) and biobutanol. Like the cellulosic ethanol production process, the thermochemical process that produces biomass-based replacements for existing fossil fuels is not yet at commercial scale, and research in this area is ongoing with the support of the DOE. Biobutanol, like ethanol, is an alcohol-based fuel that can be produced from biomass feedstocks. Biobutanol can be added to gasoline at higher blending quantities than ethanol (in unmodified engines), has a higher energy content per volume than ethanol, and is less corrosive, enabling transport in existing petroleum pipelines.19  Biobutanol is currently in research stages and no commercial production facilities currently exist.
Overall, as of January 2009, there were 26 projects using one of these three pathways (cellulose to ethanol, biomass-based substitutes for existing fossil fuels, or biobutanol) to produce fuel from cellulosic materials.20 
Technological immaturity and high cost are two key barriers to cellulosic ethanol at present. Making this fuel competitive in the marketplace will require more experience and significantly reduced production costs, including capital costs. If the costs of cellulosic ethanol production come down as the technology matures, this fuel will still face some, although not all, of the obstacles that corn-based ethanol currently faces.
Federal, state, county, and local governments currently support biofuels in a variety of ways. For a discussion of policies that support biofuel production and consumption generally, see Climate TechBook: Biofuels Overview. The following discussion summarizes policies that specifically target cellulosic ethanol and other advanced biofuels.
Biofuels for Transportation: A Climate Perspective , 2008.
Agriculture's Role in Greenhouse Gas Mitigation , 2006.
Climate TechBook: Biofuels Overview , 2009.
Climate TechBook: Ethanol , 2009.
National Renewable Energy Laboratory, “Biomass Research ”
Renewable Fuels Association, “Cellulosic Ethanol ”
U.S. Department of Energy (DOE)
1 Other examples of advanced biofuels include bio-based hydrocarbon fuels (e.g., diesel fuel) from cellulosic materials, biogas from landfills and sewage waste treatment, and butanol or other alcohols produced from organic matter.
2 The U.S. Department of Energy (DOE) is working with biotechnology and biofuel companies to reduce enzyme costs, which are currently one of the key barriers to cost-competitive production of cellulosic ethanol. See U.S. DOE. “Testimony of Alexander Karsner, Assistant Secretary, Office of EERE, Before the Subcommittee on Conservation, Credit, Energy & Research; Committee on Agriculture; U.S. House of Representatives .” March 7, 2007.
3 A dry short ton of material has been dried to a relatively low, consistent moisture level (dry weight).
4 This is based on a mix of feedstocks, mainly waste products and some energy crops. For more information, see Tables 4.3 and 4.5, Committee on Assessment of Resource Needs for Fuel Cell and Hydrogen Technologies, National Research Council. Transitions to Alternative Transportation Technologies: A Focus on Hydrogen. Washington, DC: National Academies Press, 2007.
5 Granda, Cesar B., L. Zhu, and M.T. Holtzapp. (2007). “Sustainable Liquid Biofuels and Their Environmental Impact.” Environmental Progress 26(3): 233-250.
6 Farrell, A. E., R. J. Plevin, et al. (2006). "Ethanol Can Contribute to Energy and Environmental Goals." Science 311(5760): 506-508.
7 High-diversity prairie grasses and agricultural residues, such as corn stover, have both been studied as potentially carbon negative feedstocks when indirect land use change impacts are not included. For more, see Tilman, D., J. Hill, et al. (2006). "Carbon-Negative Biofuels from Low-Input High-Diversity Grassland Biomass." Science 314(5805): 1598-1600.
Sheehan, J., A. Aden, et al. (2003).
8 For more information, see California Air Resources Board, Low Carbon Fuel Standard Program .
9 These life-cycle GHG intensities were calculated for the purposes of the California Low-Carbon Fuel Standard program. For more information on the analysis, see California Air Resources Board, Stationary Source Division. Detailed California-Modified GREET Pathway for Cellulosic Ethanol from Farmed Trees by Fermentation . Release Date: February 27, 2009. California Air Resources Board, Stationary Source Division. Detailed California-Modified GREET Pathway for Cellulosic Ethanol from Forest Waste , Release Date: February 27, 2009. and California Air Resources Board. Fuel GHG Pathways Update, Presentation : January 30, 2009.
10 Parrish, D.J. and J.H. Fike. (2005). “The Biology and Agronomy of Switchgrass for Biofuels.” Critical Reviews in Plant Sciences. 24(5): 423-459.
11 Fertilizer impacts can include eutrophication (increased chemical nutrients in an ecosystem) that leads to hypoxia (oxygen depletion) in aquatic environments.
12 Goldemberg, J. (2007). "Ethanol for a Sustainable Energy Future." Science 315(5813): 808-810.
13 All oil prices used for comparison in this section are calculated assuming refinery costs and profits are 30% of crude oil costs, and that distribution and marketing costs and taxes are equivalent for ethanol and fossil fuels.
14 Energy Information Administration. (2007). “Biofuels in the U.S. Transportation Sector.” Accessed April 25, 2009.
15 McAloon, A., F. Taylor, et al. (2000). Determining the Cost of Producing Ethanol from Corn Starch and Lignocellulosic Feedstocks. Other Information: PBD: 25 Oct 2000: Size: 30 p.
16 Fehrenbacher, K. (2008). “11 Companies Racing to Build U.S. Cellulosic Ethanol Plants .” Accessed: March 12, 2009.
17 U.S. Department of Energy. (2007). “DOE Selects Six Cellulosic Ethanol Plants for Up to $385 Million in Federal Funding .” Press Release. Accessed: March 12, 2009.
18 Committee on Assessment of Resource Needs for Fuel Cell and Hydrogen Technologies, National Research Council. Transitions to Alternative Transportation Technologies: A Focus on Hydrogen. Washington, DC: National Academies Press, 2007.
19 Suszkiw, Jan. (2008). “Banking on biobutanol: new method revisits fermenting this fuel from crops instead of petroleum.” Agricultural Research. 56(9):8-9.
20 For more information, see Renewable Fuels Association, “Celluosic Ethanol .”
21 State of Minnesota. (2008). “E20: The Feasibility of 20 Percent Ethanol Blends by Volume as a Motor Fuel.” Minnesota Department of Agriculture and the Minnesota Pollution Control Agency.
22 Yost, N. and D. Friedman. (2006). The Essential Hybrid Car Handbook: A Buyer’s Guide. The Lyons Press: 160 pages.
23 U.S. Department of Energy. (2009). “Light Duty E85 FFVs in Use .” Excel file. Accessed April 27, 2009.
24 Bureau of Transportation Statistics (2009). “National Transportation Statistics, 2009. ” Accessed April 27, 2009.
25 For more information on the distribution of E85 stations, see U.S. DOE, “E85 Fueling Station Locations .”
26 U.S. Department of Agriculture. (2007). “Ethanol Transportation Backgrounder. ” Accessed April 27, 2009.
27 Morrow, W.R., W.M. Griffin, H.S. Matthews. (2006). “Modeling switchgrass derived cellulosic ethanol distribution in the United States.” Environmental Science & Technology. 40, 2877-2886.
28 Ibid (Wakeley).
29 Renewable Fuels Association. (2008). “Cellulosic Biofuel Producer Tax Credit .” Accessed April 27, 2009.