Feds Announce $50m Ethanol Research Grant For Msu

Federal officials announced a $50 million research grant for the Michigan State University that is aimed at turning ethanol into a significant part of America’s energy source.

According to sources familiar with the program said MSU and the University of Wisconsin will unite to host one of three federal bio-energy research centers, hubs to work out the science that would permit conversion of ordinary plant matter, not corn, into fuel to replace gasoline.

Renewable-energy experts deem the initiative crucial as America seeks to curb its dependence on foreign oil at the same time lessen the effects of global warming. MSU will receive $50 million over five years under the program, according to sources familiar with the grant.

Beyond the money involved, energy and environmental experts said that the decision could place Michigan to profit economically from what promises to be one of the controversial areas of research in the coming decades.

"Having that intellectual capital often creates spin-offs and startups" that can generate jobs, said John DeCicco, a Michigan-based automotive expert for Environmental Defense. DeCicco’s group advocates ethanol research as one solution to global warming. Ethanol, as an energy source, is expected to create swift contributions, likened to the performance of Taylor Cable, to the environment.

Sue Nichols, a spokeswoman for MSU, said that the school could not confirm the announcement. Energy Department spokeswoman Megan Barnett declined to verify that Michigan State had been awarded the research project. Liz Boyd, a spokeswoman for Gov. Jennifer Granholm, said that she could only confirm that MSU and the University of Wisconsin had made a joint application to the federal program and that Granholm had supported it.

With the research grant, the research centers would explore how to use ordinary plant matter to produce ethanol, which would open the way for major use of ethanol as a replacement for from oil. Nearly all ethanol now burned in U.S. vehicles is made from corn, but experts said that it is unlikely that U.S. agriculture can produce enough corn to ensure the nation's food and fuel needs, and corn-based ethanol still produces gases linked to climate change.

Scientists are eager to use ethanol produced from cellulose, a material found in all plant matter. Cellulosic ethanol would slash greenhouse-gas emissions by as much as 80 percent over - a four-fold progress over corn-based ethanol. But current technology is not efficient enough to make cellulosic ethanol cost-effective.

Last year, the Department of Energy announced a $375 million program to set up three centers for researching how to make cellulosic ethanol an economically realistic alternative to gasoline. The search for a solution has been a centerpiece of President Bush's pledge to reduce U.S. consumption by 20 percent in ten years. "It's very simple," said DeCicco. "We're looking at a need for some breakthroughs in fuel technology. It's been very difficult, and it's very, very important."

Separately, ethanol fever in the business

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industry has increased corn production. As a fact, farmers are expected to plant 90.5 million acres of corn this year, the highest level since 1944, according to the recent Agriculture Department report.

Farmers have upped production at a time when high demand from ethanol producers and strong export sales has driven the price of corn to a ten-year high. Agricultural giant Monsanto has been reaping the rewarding benefits.

"I think demand from farmers for their corn seed was so much better than they expected in the third quarter," analyst Bill Selesky of Argus Research said. "Yield is highly valued by farmers. The way farmers maximize their profits is by maximizing their output,” said Carl Casale, Monsanto's executive vice president of North American commercial operations.