That's the goal of the new Tennessee Biofuels Initiative, an effort designed to position the state as a leader in the nation's efforts to reduce dependence on petroleum.
University of Tennessee researchers recently unveiled the initiative, which calls for the construction of a pilot bio-refinery that would demonstrate the technical feasibility of converting cellulosic biomass into ethanol in a cost-effective manner.
Currently, ethanol is produced from corn, and states in the Midwest where corn production is widespread are taking advantage of the trend toward ethanol and cashing in on corn-to-ethanol crops.
The Tennessee Biofuels Initiative hopes to tap into that market by making ethanol from agricultural products grown here, such as switchgrass, trees and other woody material.
Dr. Tim Rials, with the UT Agricultural Experiment Station, said the biofuels initiative could open an entirely new crop for rural Tennessee farmers, invigorating the state's agricultural economy.
"We feel like this is a once-in-a-lifetime opportunity to reinvigorate the rural economy. It will create a new crop and a new market for our farmers," Rials said.
"The real challenge right now is to develop a process that is economically viable and to demonstrate it so that we can move this industry into the Southeast," he said.
The initiative's proposed pilot plant would produce 5 million gallons of ethanol from cellulosic materials each year. A site for the facility has not been determined, but Rials said it most likely will be built in East Tennessee to draw on researchers from UT and Oak Ridge National Laboratory.
Rials said the plant is estimated to cost $40 million. Funding will come from the state along with potential federal partners, such as the Department of Energy and the Department of Agriculture, as well as private partners.
Eventually, more ethanol plants could be constructed across the state.
"Our hope is that with the demonstration and the insights gained at the pilot plant that private investment will pick up the technologies and help to deploy it across the state of Tennessee," Rials said.
Ultimately, the initiative could lead to the creation of 4,000 jobs and $400 million in new state and local taxes, according to the UT Agricultural Policy Analysis Center. Plus, the project could spawn co-products and satellite plants, creating another 3,000 jobs and $1 billion in revenue.
Rials said the initiative is projected to generate $100 million in new farm revenue to about 20,000 of the state's producers.
The goal is to eventually produce an annual 1 billion gallons of biomass ethanol - dubbed "Grassoline" by UT scientists - at a wholesale price of $1.20 per gallon. That would replace about 30 percent of the state's current petroleum consumption, Rials said.
"That's maybe in 15 years, maybe 10 years out," Rials said.
He said construction of the pilot plant will probably take two and a half to three years from the time funding is allocated.
Rials said the conversion to renewable fuel sources is a "real balancing act" requiring that certain factors come together at once.
"You need ethanol to be available. You need the vehicles that can use the ethanol. You also need the gas stations that can handle and pump the ethanol-blend fuels. So all the infrastructure and the processes need to move forward at a similar pace," Rials said.
He noted that most vehicles on the road today could not run on pure ethanol. But automakers are trending toward vehicles that run on an ethanol blend, such as E85 - or 85 percent ethanol and 15 percent gasoline.
The biofuels initiative is being spearheaded through the University of Tennessee's Agricultural Experiment Station, which is part of the federal Sun Grant Initiative, a network of U.S. land-grant universities and U.S. Department of Energy laboratories partnering to stimulate the development of renewable energy and new bio-based products and industries.
For more information, visit www.agriculture.utk.edu/Biofuel/index.htm.