LANSING – Woodchips and other wood byproducts that are now left to waste and potential new croplands of switchgrass are part of the vision for a new $100 million cellulosic ethanol plant that officials said Thursday will place Michigan in the forefront of new alternative fuel technology.

Gov. Jennifer Granholm led the announcement that Michigan will be the site of an investment by a Cambridge, Massachusetts-based company for the new ethanol facility.

It will join some 19 other ethanol plants in various stages of development or planning, though unlike the corn-based technology they use, the project by Mascoma will use non-food fibers.

The exact location, the number of jobs involved and incentives offered by the state and local governments are not yet final, but Mascoma president Bruce Jamerson said the general site will be in Northern Lower Peninsula or the Upper Peninsula because of the availability of wood products.

Granholm, who said the announcement is very important for the state, said, “In all of our efforts to diversity the economy, the realm of alternative energy holds the most promise. We have such a unique position in the nation to use our resources in a sustainable way to break our dependence on foreign oil.”

“It’s exciting that the birthplace of the American automobile industry is becoming a leader in next-generation fuels,” Jamerson said.

He said the plant would use an enzyme technology, which he said is cleaner than chemical processes used in other biofuel processes. He said the company, a new start-up a year and a half ago, selected Michigan because of its forestry and agricultural materials, and the expertise at Michigan State University and Michigan Technological University which will help refine the process.

The officials emphasized their goal is to make the plant the first in the nation to product commercially viable cellulosic ethanol, though the late 2008 or early 2009 start-up target is later than plans for a facility in Georgia using a different technology. That facility, announced in February with construction expected to get underway this year, will use a thermo-chemical process which officials said is a less expensive option than the use of enzymes.

Common to both systems, however, is the use of cellulosic material rather than corn or other food crops that are used in nearly all of the biofuel facilities in operation or planned construction.

“Cellulosic is the next step in wide-scale ethanol production, and this puts Michigan on the leading edge of technology that will create good-paying jobs for Michigan citizens,” Granholm said.

The state is currently cutting down less wood than is growing each year, and development on a commercial scale of a cellulosic ethanol plant could serve as a needed boost for the state’s wood industry.

Natural Resources director Rebecca Humphries said finding a use for wood material will make forests healthier and less prone to accidental fires by clearing out those volatile items while planning for the regeneration of forests and cover for habitat. Officials also said the project is an opportunity to use wood that is unused for commercial wood operations, such as remnants of trees that re used for utility poles.

Jamerson said the plant would use wood chips, tall switch grass of the type that existed in prairies and corn stalks, and would have virtually no waste. The material left over from the ethanol production is to be process into wood-like products, perhaps as pellets used for fuel.

Michigan State University President Lou Anna Simon, who two weeks ago announced a $50 million federal grant for a regional biofuels programs, said this project is not just about ethanol, but how to use biomass. She said part of the grant is to genetically engineer plants such as switchgrass which can be cultivated specifically for biofuel use.

Jim Epolito, president of the Michigan Economic Development Corporation, said the announcement of the location of the plant and other details such as state and local incentives should occur in “a few months.” He said several local areas are still competing for the facility.

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