, a bioengineering startup that says its scientific approach can rapidly find alternatives to fossil fuel-based chemicals, has some advice for the beleaguered ethanol industry: Don’t make ethanol.

The company has bred a new microorganism capable of going through the same distiller’s process that makes ethanol, but instead producing methyl ethyl ketone, a common industrial solvent also known as butanone or MEK. Chief executive Chris Gann says existing ethanol plants can use the microorganism without making any significant changes.

Ethanol is still going through a painful comedown from its highs of a couple years ago, when quite a few optimistic investors (including some venture capitalists) thought it would be a bright idea to invest in corn ethanol companies. They were wrong; turns out corn ethanol has trouble competing in price with gas, especially when oil prices are low, and the barriers to entry were also low, meaning too many companies opened plants.

Small plants are among those having the most trouble, which is where Genomatica wants to step in. MEK sells for about three times as much as ethanol right now, which could be a godsend for whoever the technology is licensed to. Gann, a Dow Chemical veteran, told me MEK is “significantly better to make in a biological plant than petrochemical.”

But even if MEK’s development progresses as quickly and as well as Gann hopes, it will take a few months more for Genomatica to finish work on the new bug (Gann says the work will go faster than Genomatica’s research on BDO production, even though that has been going on for longer). And once it’s finished, the company can’t work with everyone; just ten 50-million-gallon-per-year ethanol plants making MEK would cover the market demand.

Even so, it’s encouraging to see green chemicals companies beginning to make some significant inroads. And if more chemicals can be made this way, there may be some successes in the ethanol industry after all — even if it’s not by making ethanol.

Genomatica is based in San Diego, Calif. The company has taken about $24 million to date but is looking to raise more in a new round.