Biofuels are derived from living or recently living material that has been converted to liquid fuel to be used in engines, cars or trucks. Ethanol and biodiesel are currently commercially available, while cellulosic ethanol remains in the research and development phase.
Ethanol: Ethanol is made by fermenting and distilling carbohydrate-rich biomass through a process like that used to produce alcoholic beverages. Ethanol can be made from any feedstock that contains significant amounts of sugar (such as sugar cane) or materials that can be converted into sugar, like starch (such as corn). Ethanol derived from corn is the most widely used biofuel in the United States, and the amount of corn dedicated to ethanol production is growing. This is driving up the price and limiting availability of corn for human consumption.
Biodiesel: Biodiesel is a fuel used in diesel engines and, like ethanol, can be made from a variety of raw materials. The most common feedstock in the United States is soybeans, though rapeseed, mustard, palm oil, hemp, waste vegetable oils and animal fats can also be used. While biodiesel is only a small part of the current biofuels mix, large-scale production of soybeans for biodiesel is plagued with problems stemming from intensive industrial agricultural practices. Production of biodiesel in Southeast Asia, particularly from palm oil in Indonesia and Malaysia, has been linked to increased deforestation as forested lands are cleared for feedstock cultivation.
Cellulosic Ethanol: Cellulosic ethanol is produced from the woody, structural part of the plant rather than the grain. Currently, cellulosic ethanol production at a commercial scale remains at the research and development stage due to technological and cost barriers. The two most prominent feedstocks for cellulosic ethanol are agricultural residues, such as corn stalks, and perennial energy crops, such as switchgrass and fast-growing trees. Cellulosic ethanol offers many environmental advantages when compared to corn because the feedstocks are easier to grow -- they are often native species that need less fertilizer and herbicides, and can be more easily integrated with local agricultural systems.