The Department of Energy currently estimates the production cost of one gallon of cellulosic ethanol to be $2.20 which is twice as much as it costs to produce the same amount of ethanol from corn. However, Bodman's optimism comes from having been told privately that some companies have lowered the cost of making a gallon cellulosic ethanol to $1.50. He did not specify which companies were able to do so.
As most of you already know, normal ethanol is produced from sugar and starch based food whereas cellulosic ethanol is made from cellulose in plants and trees alleviating any issues regarding the strain on the nation's food supply. Another benefit of cellulosic ethanol, according to the Department of Energy, is that it reduces greenhouse gas emissions by about 85 percent over gasoline while sugar and starch based ethanol stand at 18 to 29 percent.