Department Secretary Samuel Bodman said the projects will demonstrate the thermochemical conversion process of turning grasses and other materials into biofuels.

The department said it will provide more than $1 billion in funding for biofuels research and development this year in multi-year projects.

"We are committed to expanding the sustainable production and use of biofuels and these projects will help develop cleaner methods for turning a wide variety of feedstocks into fuel," Bodman said.

Officials said negotiations between the Energy Department and the selected companies will begin immediately to determine final project plans and precise funding levels. Funding will begin in Fiscal Year 2008 and will run through FY 2010, subject to congressional appropriations.

The four recently selected projects involve the Emery Energy Co. of Salt Lake City; Iowa State University partnering with the ConocoPhillips Co. (NYSE:COP); the Research Triangle Institute of Triangle Park, N.C.; and the Southern Research Institute of Birmingham, Ala.