The Gekkeikan General Research Institute has a novel production technology for ethanol which utilizes cellulosic, inedible plant materials such as chaff (protective seed casings of cereal grains) and paddy straw as raw material. The technology involves the use of subcritical water to pretreat the raw material, followed by a single step simultaneous saccharification/ethanol fermentation by a genetically modified yeast which can produce its own cellulase enzymes. The conventional method for ethanol production from cellulose usually involves: (1) pretreatment of the raw material by chemical agents (such as acids) to liberate the cellulose fibers from their “lignin wrappings”, (2) enzymatic saccharification (using cellulase) to break the liberated cellulose molecules into simple sugars, and (3) yeast fermentation of the sugars to produce the ethanol. In the Gekkeikan technology, the use of subcritical water temperature (150^oC to 370^oC) is said to be more “environment friendly”, since it does not use chemical agents, such as sulfuric acid. By using genetically modified yeast that is capable of producing its own cellulase enzymes, the saccharification and fermentation steps can be combined into a single process, thus reducing production costs..