Motorists have heard a lot lately about ethanol-based fuels, which burn cleaner than gasoline and derive from renewable, domestic biomass. Iogen Corporation has furthered this technology by developing enzymes to convert tough, sugar-bearing cellulose in inexpensively produced agricultural waste into ethanol (opposite page, top).

Another renewable alternative fuel is biodiesel—predominantly vegetable oils that are processed to serve as a clean-burning fuel for diesel engines. Michikazu Hara of the Tokyo Institute of Technology and his colleagues have demonstrated that a charred mixture of inexpensive sugars, starches or cellulose can be treated to formulate an effective solid-acid catalyst for making biodiesel that is insoluble, cheap to prepare and easy to recycle.

Engineers are toiling to make diesels operate with fewer nitrogen oxide emissions. A leader in this quest is German-based automaker DaimlerChrysler, which recently introduced BLUETEC technology—a modular exhaust treatment system that cuts nitrogen oxide and soot output significantly, enabling cars to meet the most stringent U.S. emission standards.

Another technology that gets better mileage than standard engines, and hence produces less carbon dioxide for each mile driven, is the gasoline-electric hybrid, which marries a gasoline engine with electric motors. Current hybrid vehicles save fuel in stop-and-go driving but provide little mileage benefit on the highway. The new two-mode hybrid system from General Motors, DaimlerChrysler and BMW boosts fuel efficiency at both low and high speeds, improving combined mileage 25 percent over standard models.

Yet another way to raise the environmental performance of hybrid vehicles is to give them the means to store electrical grid power so that at times they can run on electricity alone instead of drawing power from a fossil-fuel-burning engine. These plug-in hybrids came closer to reality when two companies, EDrive Systems, a joint venture of EnergyCS and Clean-Tech in California, and Hymotion, a Canadian company, each introduced plug-in hybrid upgrade kits for the Toyota Prius. In the wake of these developments, the road to a greener, more sustainable energy future seems to be opening up.