Japan aims to slash cost of cellulosic ethanol by 98 percent

In Japan, the Ministry of Economy, Trade and Industry announced a goal of producing ethanol from silver grass at a cost of 40 yen per liter. Current Japanese technologies produce ethanol from celluosic biomass at a cost of 2,000 yen per liter.

The Japanese government has set a goal of replacing 0.6 percent of gasoline fuel with biofuels by 2010. The E3 ethanol mandate recently led to the introduction of two pumps in Osaka as Japan finally begins to rollout its biofuels mandate.

The silver grass initiative comes as the latest in a series of Japanese initiaves in biofuels. Last week, Sojitz agreed to acquire a 33 percent stake in ETH Bioenergia for $80 million. ETH Bioenergia, a subsidiary of Oldebrecht, will produce 259 Mgy of ethanol. In August, Mitsubishi announced plans for 500 million gallons in ethanol production capacity by 2017 as Japan ramps up on its biofuels conversion.

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