The system takes feedstock (a combination of sugar and yeast) or discarded alcohol, and combines it with water to distill 100% pure ethanol. Turning sugar into gas may sound like the work of mad scientists, but according to CEO Tom Quinn, home ethanol production was advocated and used by Henry Ford when he created the Model T. I imagine that home-made ethanol wasn't as easy to make back then, because if it was, we probably wouldn't have switched to gasoline in the first place.

The MicroFueler produces ethanol using membrane distillation. Sugar, yeast and water are blended together to create the chemical reaction that produces ethanol. After two days, the fermented sugar water is turned into vapor, and the ethanol is separated from the water. By the end of the week, the MicroFueler reservoir will hold 35 gallons of pure ethanol, enough to fill at least two cars. This is a lot like Dean Kamen's water purifier, except in reverse. In fact, creator Floyd Butterfield says the water by-product is clean enough to drink.

The most astounding part is that a car doesn't require pure ethanol to run, due to its higher-than-gasoline octane content. E-Fuel says you can fill up your tank with 75% ethanol and 25% water and your car will run fine.

The price tag may seem steep, but federal, state and local tax credits can bring the price as low as $5000—average cost with credits is more like $7000. The creators say an average home will save around $4200 on gas each year, and the machine will pay for itself in about a year and a half.

That said, people have been doing this on their own for a while. Plans available online estimate a true DIY machine costs about $500 to build, but for those who don't want to run the risk of spontaneous combustion (like me), the MicroFueler seems like a wise alternative. [E-Fuel]

Carbon haters would be happy that a gallon of the MicroFueler's ethanol is supposed to produce just 12.5% of the carbon from a gallon of normal gasoline. Butterfield is also someone who people should listen to: In 1982 he won an award from the state of California for "best design of an ethanol still" says the Times. (I had NO idea I could enter my still in a competition!)

Naysayers predict that quality control would be a problem (and anyone who's ever homebrewed beer can probably attest to the finicky nature of the process. Others charge that since sugar costs 20-cents per pound, and you need 10 to 14 pounds to make a gallon of ethanol, well, there goes your cost savings. But Butterfield and his Silicon Valley finance whiz/business partner Thomas J. Quinn swears you can buy "inedible sugar" from South of the Border for 2 to 3 cents per pound.

There's also a small matter of 100% ethanol being illegal as an automotive fuel, but Quinn says that, too, will be resolved. [NYT]