This project aims at development of cost effective and sustainable production methods for ethanol based on lignocellulosic waste materials or dedicated crops. The raw materials are among the potential ones in Southern, Eastern and Northern Europe, comprising forest and agricultural residues as well as a energy crop. The project focuses on the key issues, essential for improvement of the process steps in the conversion of lignocellulosics to ethanol. Novel technologies will be developed for pre-treatment and enzymatic hydrolysis steps, which comprise up to 50% of the present production costs. The aim is to increase the yield of ethanol, is well as to decrease the energy consumption in the production process. The production costs of ethanol would expectedly be reduced by 10-20% in medium-to-long term. A techno-economic analysis of the new process concept will be carried out.