The hope for better biofuels got $375 million brighter today thanks to a massive new funding program announced by the U.S. Department of Energy. The highly competitive grants, given out over the next five years, will establish bioenergy research centers at the Oak Ridge National Labs, in Tennessee; the Great Lakes Bioenergy Research Center, in Wisconsin; and the Lawrence Berkeley National Laboratory, in California. The centers will search for innovative ways to make cellulosic-ethanol production economically competitive with gasoline.

“For biofuels to put a real dent in our energy consumption without affecting the national food supply and without adding to carbon-dioxide emissions, we must learn to make ethanol from cellulose,” said secretary of energy Samuel Bodman at a press conference today. “Only by inventing radical new technologies will we be successful.”

The United States produced five billion gallons of ethanol from corn last year–about 4 percent of all national gasoline production. However, deriving ethanol from corn is itself an energy-intensive process, and it can’t be sustained in large enough volumes to meet the president’s goal of reducing gasoline consumption by 20 percent in the next 10 years. Grasses and agricultural waste such as cornstalks could potentially provide a better feedstock: they produce much more biomass per acre than corn, with less energy expenditure. However, these plant sources of ethanol require extensive preprocessing to release sugars from the cellulose in them, making the procedure too expensive to compete with traditional gasoline and corn-based ethanol. (See “Biofuels: Beyond Corn.”)

Scientists at the three new centers will try to overcome these hurdles using genomics tools. For example, they plan to catalogue the genes involved in building plant cell walls in order to engineer plants that can be more easily broken down before fermentation. Scientists will also scour the genomes of fungi and microbes for novel cellulase enzymes that are cheaper and more efficient than the synthetic enzymes in use today.