Scientists at the Department of Energy's BioEnergy Science Center found the that controls its capacity to produce ethanol gene in the microorganism Clostridium thermocellum.
Scientists use expensive enzymes for biofuel production from plants like switchgrass. The discovery of the single gene gives researchers the opportunity to experiment with genetics to coax the microorganism to produce more ethanol.
"This discovery is an important step in developing biomass crops that could increase yield of ethanol, lower production costs and help reduce our reliance on imported oil," U.S. Energy Secretary Steven Chu said in a statement.
The Energy Department announced that, along with the Department of Agriculture, it awarded $12.2 million for 10 separate grants that target improvements in biofuels and bioenergy crops.
U.S. President Barack Obama had promised to add more renewable energy and advanced biofuels to the domestic energy mix. Chu said bioenergy research and development would help U.S. energy security measures.
"Biofuels, along with other advanced vehicle technologies, hold the potential to help reduce our oil imports while adding new jobs and driving wealth creation in rural America," he said.