KL Energy Corp., a leading producer of second-generation cellulose-based ethanol (CBE), Friday announced it has secured $4 million of additional capital, which will fuel its efforts to hold its competitive position in the alternative energy market.

Steve Corcoran, recently appointed CEO of KL Energy, said that even in such taxing economic times, the company’s operations and growth allowed it to attract investors who see the potential for its technology.

“In spite of the current economic environment we were able to secure additional capital to continue our growth initiatives. This capital infusion is verification that KL Energy Corp. is positioned to be at the forefront of commercializing second generation cellulosic ethanol production. While some are looking to build demonstration plants, we are on the way to building our next commercial facility. The investors also bring to KLE a substantial international network, and we are already benefiting from their relations as potential projects in South America, Europe and Scandinavia have requested proposals for our technology,” Corcoran stated in the press release.

Warcoing Sucre S.A and Pierre de Boeck teamed with Niton Capital and The Green Fund, who originally invested $6.1 million in October 2008, to provide the funding, which brings the aggregate investment in KL Energy to $10.1 million.

KL Energy said the capital will be used to focus on optimizing its proprietary processes at the company’s commercial-scale second-generation CBE plant in Upton, Wyoming. The plant works on CBE as an alternative energy source to develop processes that convert waste and biomass rather than food and sugar-based ethanol production. The company said it believes its CBE plant to be the first of its kind in the nation.