Forget chip fat, sugar cane or rapeseed oil – the latest source of biofuel could be watermelons.


Scientists have discovered that the fruit is a great source of sugar that can be readily distilled into alcohol to power cars and farm machinery.


And because retailers rejects 360,000 tons of "substandard" fruit annually in America alone they could be used as an economical way to make fuel.


The waste from US growers could produce nearly two million gallons (nine million litres) of biofuel per year.


In the study, researchers at the United States Department of Agriculture set out to determine the biofuel potential of juice from "cull" watermelons – those not sold due to cosmetic imperfections, and currently ploughed back into the field.


About a fifth of each annual watermelon crop is left in the field because of surface blemishes or because they are misshapen.


Dr Wayne Fish, who led the team, found that 50 per cent of the fruit was fermentable into ethanol which could provide valuable fuel.


"We've shown that the juice of these melons is a source of readily fermentable sugars, representing a heretofore untapped feedstock for ethanol biofuel production," he said.


The study, published in the journal Biotechnology for Biofuels, discovered that watermelons could produce around 20 gallons of fuel per acre from fruit that otherwise would go to waste.


Production of biofuels has been targeted by western governments as a way to bolster renewable energy targets.


The European Union has a target for 2010 that 5.75 per cent of transport fuels should come from biological sources, but the target is unlikely to be met.


The British government's Renewable Transport Fuel Obligation requires five per cent of the fuel sold at the pump by 2010 to be biofuel.