Abstract World energy demand is straining energy supplies and spurring the search for alternative energy sources - especially transportation fuels. Ethanol produced from cellulosic feedstock has been called a 'second-generation' biofuel. (Ethanol made from maize and sugarcane represents a 'first-generation' biofuel.) When choosing a cellulosic species for fuel production, one must consider the type of fuel desired, the economics of producing the crop on a large scale, the system's energy balance and environmental effects. With suitable conversion technologies, cellulosic materials from maize, eastern gamagrass, giant reed (fibre cane), Miscanthus , reed canarygrass, sorghums, sugarcane and switchgrass might be used to produce biofuels in the USA and other non-arid, sub-tropical or temperate locations. Each of these species has characteristics that make it more or less suitable in particular situations. Because of generally reduced input requirements, perennial species might be favoured. Biofuel production systems can mitigate greenhouse gas (GHG) emissions by offsetting fossil fuel use and by sequestering carbon into the soil. The amount of GHG reduction depends on crop yields, conversion efficiencies, and net energy and carbon balances associated with each feedstock source.