Scientists have improved the technique for transforming coal into "green diesel," potentially making the process economically feasible to bring the fuel to a pump near you.
Coal fuel is seen by some as a potential bridge between the limited supply of oil and alternative fuels, many of which aren't ready for prime time.
The United States is sitting on enough coal to make this idea feasible, if it can be extracted and processed cost-effectively. Some 95 percent of the country's energy reserves are coal, while oil and gas make up 2 and 3 percent respectively.
"Many people in the energy sector think that when oil starts to run out, coal will be a source of transportation fuel for some time before we perfect the science behind solar and hydrogen-based energy," said Maurice Brookhart, a chemist at the University of North Carolina.
The method for transforming coal and other carbon sources into liquid fuel has existed since the 1920s. Today, most large vehicles in South Africa are powered by diesel fuels produced by this method.
American companies have expressed interest in the technology, but the process has proved too expensive to catch on, even though green diesel emits fewer particulate and less carbon monoxide pollution than gasoline engines.
The researchers have improved the process by using special catalysts that rearrange carbon atoms in coal to form higher-energy molecules, which are then converted to usable diesel.
The process is still in its early stages and will need further improvements before becoming commercially available.
The research is detailed in today's issue of the journal Science.