The four-year projects are designed to support development of small-scale cellulosic technology biorefineries in Old Town, Maine; Vonore, Tenn.; and Washington County, Ky.

"Sustained investments in cellulosic fuels made from corn cobs, woodchips, switchgrass and other agricultural waste will strengthen our nation's energy security by reducing our dependence on foreign oil," said Energy Department Secretary Samuel Bodman.

He said the three projects will use a wide variety of feedstocks and test novel conversion technologies to provide data necessary to commercialize full-scale biorefinery technologies.

On average, commercial-scale biorefineries input 700 tons of non-food based feedstock daily, producing approximately 20 million-30 million gallons a year. The small-scale projects will input approximately 70 tons of feedstock daily, with an estimated production of 2.5 million gallons a year.

Expected to be operational within four years, officials said the biorefineries projects will produce liquid transportation fuels such as cellulosic ethanol, as well as bio-based chemicals and bio-based products used in industrial applications.