From the Financial Times comes a report that DuPont and British Petroleum have had a major breakthrough in the development of an alternative fuel they term “biobutanol.” “The new product,” according to the FT, ” produces more energy than ethanol and can be used in vehicles more easily without modification to engines.”

In a separate report FT notes that a number of refiners and auto manufacturers are wary of current efforts to move towards E85 and ethanol, noting that “Wall Street is drunk on ethanol” and that opponents of the current rush to an ethanol/flex-fuel solution argue quite convincingly “that it is better to wait until the next generation technology is ready to avoid locking farmers into crops that no longer will be needed.”

Corn-based ethanol is significantly less efficient than gasoline, requiring about four gallons to cover the same distance that can be covered using three gallons of gas. There is also the risk of rising food prices due to increased demand on foodstock crops as oppossed to food waste-based biofuels. “There is a great deal of risk that we will just get stuck with a low blend and the corn ethanol industry walks away with billions of dollars.”

Breakthroughs like that announced yesterday by DuPont and BP lend significant credence to these arguments. As well as providing an alternative to oil, biobutanol is 95% as efficient as gasoline. Biofuels based on non-food crops also “reduce greenhouse gas emissions because the plants from which they sre made take up carbon dioxide from the atmosphere as they grow.”

Work on biobutanol is still ongoing, and while 9M gallons will be produced next year, neither company expects the product to be in full production before 2010. However, as at least one analyst points out, there is “clearly a benefit if you can use this without changing engines.”

That may seem like an obvious statement, but if you look at the money being poured into new engines that can burn more corn-based ethanol, you have to ask yourself just how obvious this simpler, more elegant solution is–at least to those with a different horse in the race…