General Motors and Coskata Inc. Partner to Lead the Ethanol Revolution

General Motors and Coskata Inc. are teaming up to deliver low cost ethanol to consumers. On its website, Coskata claims to have developed a new process for producing ethanol at costs as low a $1.00 a gallon. That is about half the amount it takes to produce a gallon of gasoline.

Both companies hailed the breakthrough as an opportunity to prove that ethanol is a viable alternative to gasoline. "There is no question in my mind that making ethanol more widely available is absolutely the most effective and environmentally sound solution. And it's one that can be acted on immediately," GM CEO and Chairman Bill Wagoner was quoted as saying in a press release issued by Coskata.

In its own statement on the partnership, GM noted that it had already produced around 3.5 million flex-fuel vehicles globally. Around 2.5 million of those are capable or running on E85, a fuel blend containing 85 percent ethanol and 15 percent gasoline.

This year alone, GM is offering 11 different models capable of running on E85. In Brazil, GM is already selling vehicles that run on ethanol alone, E100. And the company has committed to making major increases in its production of flex-fuel vehicles.

But in order to make flex-fuel vehicles appealing to consumers, there has to be a reliable source of fuel. That is where Coskata comes into the equation. The company hopes to open its first production facility in 2011. It says that facility will be able to produce between 50 and 100 million gallons of ethanol annually.

The Coskata process produces ethanol from some interesting sources, including urban and industrial waste. According to the company's website, the U.S. alone generates more 1 billion tons of biomass that could be converted into ethanol. It takes one ton of biomass to produce 100 gallons of ethanol using the Coskata process.

The partnership between GM and Coskata has the potential to jumpstart the renewable energy industry. If the duo can carry through on their promises to create more flex-fuel vehicles and provide a reliable source of ethanol in the short term, they could revolutionize the auto industry. This is a partnership that environmentalists, consumers, and investors should watch. Amidst a lot of talk about the potential for a green energy revolution, GM and Coskata are walking the walk.