According to a report in Live Science, the company, known as the Sierra Nevada Brewing Co., in Chico, California, has developed the new system, in collaboration with E-Fuel Corporation.

The company will start testing the system in the second quarter of this year, and hopes to move to full-scale ethanol production in third quarter.

“This has the potential to be a great thing for the environment and further our commitment to be becoming more energy independent,” said Ken Grossman, founder and president, Sierra Nevada Brewing Co.

Currently, Sierra Nevada resells almost 1.6 million gallons of unusable “bottom of the barrel” beer yeast waste to local farmers to be used as dairy feed.

The waste contains 5 to 8 percent alcohol content, including enough yeast and nutrients to enable the ethanol system, the MicroFueler, to raise that level to 15 percent alcohol, allowing for an increased ethanol yield.

“Creating ethanol from discarded organic waste is an excellent example of how the MicroFueler can help eliminate our reliance on the oil industry infrastructure. This is especially true when considering Americans reportedly discard 50 percent of all agricultural farmed products,” said Tom Quinn, E-Fuel founder and CEO.