For the second year running the environment is set to dominate proceedings at the North American International Auto Show in Detroit after leading manufacturers yesterday unveiled a raft of green cars and initiatives.

In a move underlining the scale of the auto industry's green conversion, General Motors (GM) yesterday unveiled an ethanol powered version of its oft-criticised Hummer.

The military-style Hummer, which boasts dismal fuel efficiency of barely 16 litres per 100km, has become a powerful symbol of the car industry's irresponsible approach to the environment for many environmental lobbyists.

However, with industry execs last week predicting sales of heavier vehicles boasting poor fuel efficiency will fall in the coming years GM has responded with a concept version of the Hummer which will run on bioethanol.

The Hummer HX - which was unveiled alongside a bioethanol powered Saab concept car - debuted as GM announced it had inked a major partnership with biofuel processing start up Coskata.

The company claims to have developed a new process for creating bioethanol from "practically any renewable source, including garbage, old tyres and plant waste", rather than fuel crops. As such the company claims the approach addresses many of the concerns surrounding the environmental impact of fuel crops and also delivers significant carbon emission reductions.

GM said that research from the Argonne National Laboratory found that Coskata's bioethanol reduces CO2 emissions by up to 84 percent compared with a well-to-wheel analysis of gasoline. It also uses less than a gallon of water to make a gallon of ethanol compared to three gallons or more for other processes.

Under the terms of the partnership, GM will receive the first ethanol from Coskata’s pilot plant in the fourth quarter of 2008 and will use the fuel to test vehicles at the company's Milford Proving Grounds.

"We believe ethanol used as a fuel, not just as a gasoline additive, is the best near-term alternative to the surging global demand for oil because ethanol is renewable and it significantly reduces CO2 emissions compared to gasoline," said Beth Lowery, GM vice president environment, energy and safety policy. " Best of all, it is available today."

Meanwhile, Toyota confirmed it would launch its first plug-in hybrid vehicle by 2010 – putting the company head-to-head with GM which had previously said its Chevrolet Volt plug-in hybrid will also be launched around 2010.

Speaking at the Detroit show Toyota president Katsuaki Watanabe said that the company would launch a fleet of plug-in hybrids running on lithium-ion batteries capable of being charged from external recharging points. He added that the company was also working on a new Lexus hybrid and another new hybrid for the Toyota brand, both of which would be debuted at next year's show.

Ford also showcased its latest green innovations, debuting its new EcoBoost direct injection engine which it claims can improve fuel efficiency by 20 per cent and cut carbon emissions by 15 per cent.