The Department of Energy provided $1.7 million in grants to UT for research in processing and using switchgrass for fuel in 2004. The funded project was focused on techniques to mechanically separate plant chemical constituents as dry material that could be further purified with a wet chemical process. The project was a collaboration between UT, Oak Ridge National Laboratory, and First American Scientific Company, a maker of biomass and rock grinders. FASC made an in-kind contribution of $100,000 for engineering and business plan expertise.
In 2007 the Tennessee Legislature provided $40 million to the UT system to create the Tennessee Biofuels Initiative, a research and development project focusing on extracting fuel-grade ethanol from the cellulose in woody grasses and trees. UT partnered with Mascoma Corporation, a firm specializing in research on enzymes and organisms that break down the cellulose in woody materials. UT and Mascoma joined in the capital pilot project, in Niles Ferry Industrial Park in Vonore, Tennessee, to produce ethanol from switchgrass. The product was dubbed “grassoline.” The total state investment was estimated to be $70 million. The pilot plant was characterized as a research facility but was expected to produce five million gallons of ethanol a year—requiring approximately 170 tons of grass a day, and thus eight thousand acres of crops. When Mascoma left the project, DuPont Danisco Cellulosic Ethanol LLC became the institutional partner.