U.S. Secretary of Agriculture Tom Vilsack is scheduled to visit King of Prussia on Friday for the opening of a new industrial-sugars production facility and to announce $7 million in funding for biofuels research at the U.S. Department of Agriculture's Eastern Regional Research Center in Wyndmoor.

The new unit at Renmatix Inc. is designed to convert materials such as wood, agricultural residue, some types of grass, and other waste materials that do not compete with the food supply into sugars that can be further processed into industrial chemicals.

The USDA is not among the investors in privately held Renmatix, but the company is at home in Vilsack's vision of a "bio-based" economy that can help rejuvenate rural America.

"It's not just fuel and not just energy that's being produced. We virtually have the capacity to have a new economy in this country" using chemicals produced from plants instead of oil, Vilsack said in an interview Thursday.

The $6.9 million grant for research in Wyndmoor is part of $25 million in funding that includes projects in Ohio, Kansas, and Utah geared toward non-petroleum-based fuels and materials that do not compete with food crops.

A big knock against corn-based ethanol is that it drives up food prices.

The goal of the research in Wyndmoor, where about 75 people work, is to develop systems for turning forest residues, animal manure, switchgrass, and other perennial grasses into biofuels and specialty chemicals on the farm.

Researchers there are focused on a process called pyrolysis, which involves heating organic material to 500 degrees Celsius in a chamber with no oxygen, said Kevin B. Hicks, research leader for the group. The material turns from solid to liquid, including "bio-oil," Hicks said.

The trick is competing financially with petroleum-based fuels. Hicks and his team are not there yet.

"We have taken this technology to a certain technical-readiness level," he said. The three-year grant will allow the group to continue development and seek to reduce the costs to make the fuel competitive.

Partners in the Wyndmoor research include the American Refining Group Inc., which has an oil refinery in northeastern Pennsylvania, plus several Philadelphia-area universities.

Renmatix, which is in small-scale production for testing, moved its headquarters and technical center to King of Prussia from Georgia in September 2011. It now employs 50 there, chief executive Mike Hamilton said.