Moving Beyond Corn

Investors are pouring new money into companies developing alternative ethanol-production technologies.

Sources like paper pulp and barley are gaining attention as the merits of corn-based ethanol as an alternative fuel source is being questioned by environmentalists and politicians because of the fuel’s link to rising food prices.

In May, oil-and-gas giant Marathon Oil Corp. led an $81 million debt-and-equity funding round for Mascoma Corp., a Boston-based company making ethanol from cellulosic plant material. General Motors Corp. is among the investors in that round and it also has partnered with Mascoma to test biofuels. It was the second investment this year by the auto maker in a cellulosic-ethanol company.

Mascoma uses various feedstocks such as woody biomass, corn stover, and paper pulp to make ethanol.

Wall Street Journal