The three-year-old research center at Southern Illinois University Edwardsville was built in part with $14 million in federal money. Public and private groups use the center to test ethanol technology.
"The department should not consider wastefully funding a new and completely redundant pilot facility for cellulosic ethanol research," Blagojevich wrote to federal Biomass Program officials.
The newspaper reported that the letter, to be sent Monday, is Illinois' response to a federal request last month for feedback on whether there's interest in a plant designed to convert cellulose from materials such as switch grass and sawdust into ethanol.
A letter similar to the governor's has been sent by Decatur-based Archer Daniels Midland Co., the top producer of ethanol in the nation.
"Let's first make use of the good facilities we have," said Thomas Binder, president of research at ADM.
Martha Schlicher, director of the Edwardsville research center, said revamping the center could cost as little as $8 million and be accomplished in six months.
"We're not starting from scratch so you don't have to recreate everything we already have," she said.
A spokeswoman for the Energy Department declined to discuss the governor's letter, which was obtained by the Post-Dispatch .