There has been some significant progress in engineering our favorite yeast, Saccharomyces cerevisiae, (brewer’s yeast!) to produce n-Butanol rather than ethanol. This is particularly interesting from a fuel production standpoint, since there are major advantages of n-Butanol over ethanol for fuel. From a recent Green Car Congress post:
Butanol has a number of advantages over ethanol for use as a biofuel—it is more hydrophobic; has a higher energy density; can be transported through existing pipeline infrastructure; and can be mixed with gasoline at any ratio.
As someone who spent a lot of time genetically engineering organisms, this is an important milestone. There remains a lot to be done, but at least the beginnings of an approach as been outlined by this research. The paper (available open access here) has a lot of follow-on information about likely approaches to improve the process and/or yield. This is where hackers can jump in and possibly make a contribution- a lot of the basic stuff can be based on computational approaches and dynamic simulation. Let a million flowers (or yeast) bloom!