Blairstown, Iowa - In a converted corn ethanol plant 25 minutes from Cedar Rapids, four-story tanks of renewable fuel are quietly bubbling away ready for conversion into fuel-grade ethanol later this week. What makes this fuel special is its main ingredient: instead of corn, Maryland-based Fiberight LLC, has found a way to turn one company's organic waste into valuable renewable fuel.

"Everyone from the average household to large industrial manufacturers is focused on reducing waste," said Fiberight CEO Craig Stuart-Paul. "But the reality is that there will always be a significant waste stream in this country. What's unique about our approach is that we can take that waste and turn it into billions of gallons of fuel to spur the nation's energy independence while at the same time reducing carbon emissions by more than 80 percent compared with gasoline."

One such industrial company is International Paper (NYSE: IP), one of the world's largest packaging and paper producers. The company started shipping Fiberight organic fiber waste from its Cedar River recycled paper mill at the beginning of May.

International Paper's Cedar River mill produces 1 million tons per year of recycled paper for corrugated packaging, made from old corrugated containers (OCC). About 95 percent of OCC can be recycled into new paper, but the remaining unusable fiber goes into the mill's waste stream. That adds up to about 50,000 tons of residual fiber waste each year. Previously, this residual fiber was sent to local agricultural companies for fertilizer, animal bedding and other land applications at a cost to International Paper.

"When Fiberight approached us in late 2008 with their idea for using our residual fiber to process renewable energy, we saw this as a potential win-win for both companies," said Tom Olstad, operations manager at International Paper's Cedar River mill. "As one of the largest recycled paper mills in the world, recycling and reusing raw materials is a big part of how we operate. Through Fiberight's new facility, we can now be assured that whatever recycled fiber can't be made into new packaging can be used to create green energy, while helping us offset our disposal costs."

The residual fiber waste from International Paper provides a good base-load feedstock for the biorefinery, and is consistent with business goals of International Paper to ensure responsible environmental stewardship, as well as reduce costs.

In addition, Fiberight will be introducing organic pulps made from residential trash to the plant later this month. The company has spent the last six years designing processes to separate this organic pulp from everyday waste, creating more recyclables and energy from other parts of the waste stream along the way.

"You can't just back up a trash truck to a corn ethanol plant and expect fuel to come out the other end," said Stuart-Paul. "We undertook extensive modifications to the plant to incorporate our proprietary digestion and fermentation techniques, as well as processes to help convert organic pulps into cellulosic sugars. I'm very pleased to say that these processes worked extremely well, and hats off to our engineering team, APS Engineering, for making this a reality."

Fiberight plans on spending approximately $25 million to fully convert the Blairstown plant and anticipates producing up to 6 million gallons a year of renewable cellulosic ethanol when the plant reaches capacity sometime in 2011.

"Our plans include integrating all the process developments we have learned at our Virginia pilot plant into one facility, and demonstrating the ability to create a series of products that bring a higher value to waste than simply disposing of it," Stuart-Paul said. "However, without the ability to convert the organic fraction (food scraps, packaging waste, diapers etc.) into fuels, or 'trashanol' as we like to call it, or even biochemicals that can be used to make bio-plastics, the economics don't work. It is Fiberight's ability to do this and to be one of the first in the nation doing so at this scale that sets us apart."