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In the relatively small world of what's known as cellulosic, or biomass, ethanol, these were electrifying words. 

"We'll also fund additional research in cutting edge methods of producing ethanol," the President said. "Not just from corn, but from wood chips and stalks or switch grass. Our goal is to make this new kind of ethanol practical and competitive within six years."  

Loren Forrest was very interested in the President's speech.   The Luverne area farmer has a vision; he wants to build a new wave energy plant that converts leftover corn stalks into liquid ethanol fuel.  He says he's been working for five years on the project.

"I guess I got a little Norwegian blood in me and it's stubborn,"  says Forrest.

Forrest says the President's words lit a fire.   Forrest and his partners hope to break ground on their plant in a year or so. 

"Ever since I been a kid I loved Erector sets so this would be the biggest Erector set I could ever lay my hands on so I'm interested in building it,"  says Forrest.

If Forrest succeeds it will be the first commercial grade biomass ethanol plant in the U.S.   It would also join a select world club.  

What's billed as the world's first commercial facility is under construction in Spain.  It's relatively small though compared to what Forrest and his partners hope to build.   

Most of the work in this area of ethanol production so far has focused on small scale, experimental production.  Demonstration plants are operating in Mississippi and in Canada.  

Loren Forrest says the name of his Luverne company is Rural Energy Marketing.  South Dakota farmer Brian Smit is part of the business.

"It seems like all of the stars are aligning for us,"  says Smit.   "And we want to lead the way, we want to be breaking ground on our first plant in the spring of '07 if we can."

The State of the Union encouragement was part of the new alignment. Another important piece came in last year's energy bill.  

"There are government grants available for the building of our first plant,"  says Smit.  "There are 80 percent loan guarantees available for these types of plants and also there will be a per gallon incentive payment for any cellulosic or biomass ethanol production."

The Luverne company plans to use a gasification process to make the ethanol.

In simplest terms, it's a process of taking things apart and then putting the pieces back together again in a different form.  Under intense heat, the corn stalks are first turned into gas, mainly hydrogen and carbon monoxide.   Then, using a catalytic converter, those atoms and molecules are linked together in a new way; the chemical structure of ethanol.  

The Luverne company is one of several Minnesota businesses interested in the process.   

"We can't help but notice the concept of cellulosic ethanol has really risen here just in the last few months,"  says Bill Lee.

Bill Lee is General Manger of Chippewa Valley Ethanol in Benson. He says the company is exploring biomass ethanol.  Chippewa Valley plans to build a system to gasify plant material, probably corn stalks.  The gas will then be used to power the company's traditional corn fermentation ethanol plant.  Lee says even though it stops short of making biomass ethanol, the gasification process is an important step in that direction.  

"We would like to think that if there is going to be that business some day, then we're setting CVEC up on a track to participate in that,"  says Lee.

A second Minnesota ethanol company, this one in Little Falls, is also building a gasification unit.  It will use wood chips as raw material.  Loren Forrest of Luverne says there's plenty of room for everyone in biomass ethanol.  He sees a day when there will be new generation ethanol plants every 20 miles or so in farm country.   

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Spurred on by President Bush, several companies are racing to build the nation's first biomass ethanol plant.  A group of Minnesota and South 
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