HOLDEN has unveiled its latest Commodore range, which could eventually be powered by household waste.

Holden is planning to export 600 cars from the series for an initial special edition model for Brazil and is hoping to grow these numbers over time.



Holden chairman and managing director Mike Devereux said the deal came as Holden and the Australian car industry emerged from a tough time prompted by the global economic downturn.



"It's been a pretty turbulent time, make no mistake about it, both for Holden but also for the entire auto industry," he said.



"I think we're emerging from that both stronger and wiser than ever."



Both V6 and V8 models in the VE Series II Commodore line-up have been designed as the first Australian-made vehicles to run on bio-ethanol as well as conventional petrol.



Bio-ethanol, also known as E85, is a cleaner burning fuel capable of cutting carbon dioxide emissions by up to 40 per cent and is cheaper than regular fuel petrol by 20¢ a litre.

It is produced from the by-products created during the processing of wheat, sugar and sorghum. The ethanol is then blended with 15 per cent petrol.

But Holden is also investigating the viability of establishing Australia's first ethanol plant that would produce the fuel from household and other waste.

Mr Devereux said the introduction of the E85 flex-fuel technology was part of the company's commitment to leading the push towards alternative fuels.

"We have placed an enormous emphasis on developing technology that can be used in today's vehicles to make driving better for the environment," he said.

"That has included leading the way for Australian produced cars with bio-ethanol, providing motorists with a cleaner fuel alternative when filling up their car.

"It is the first major step forward in our efforts to move renewable fuels like bio-ethanol from a niche product into the mainstream by making it available on Australia's top selling car line."

Fuel retailer Caltex will start selling the E-Flex high-ethanol blended fuel at 31 outlets in Sydney, Melbourne, Adelaide, Brisbane and Canberra from October.

That number will rise to 100 in 2011, including some regional sites.

Holden's energy and environment director Richard Marshall said the company believed bio-ethanol had a big future in Australia.

"It is a cleaner-burning, renewable fuel and long term we think it has the ability to displace up to 30 per cent of Australia's petrol use," he said.

The new cars will go on sale in late September.