Even though it is quicker off the mark than most sports models and develops so much power that it has to be restricted to a 155mph top speed, the next new car from Saab is set to be as much a smash-hit with conservationists as it will be with driving enthusiasts.

Due to go into a limited production run next year, a special ethanol-powered version of the 9-5 executive range is the direction Saab will go for its future alternatively-powered cars.

The Swedish manufacturer is preparing to launch a Europe-wide campaign to prove the viability, practicality and economic arguments showing ethanol – known in fuel form as E85 and derived from agricultural crops or forest residues – as the most effective short-term alternative to petrol.

"As far as we are concerned, this is the only way to go," enthused Saab GB managing director Jonathan Nash as we climbed out of the bright red 9-5 Aero estate after an exhilarating drive through the countryside around the company’s manufacturing centre at Trollhattan.

Fast is the only word for the 2.3-litre prototype with the power to reach 62mph from standstill in just six seconds and capable of topping 180mph all-out with its electronic speed limiter removed.

The BioPower cars are able to run on E85 or petrol without adjustment, but the 2.0-litre motor, which will be the size of the production model, develops 20% greater power on green fuel – because it has a much higher octane rating – producing 180bhp and 207lb-ft torque compared with 150bhp and 177lb-ft for petrol.

Ethanol also returns up to 15% improved economy.

When it was first fitted to the prototype, the engine was producing 330bhp, but factory development engineers have had to detune it after several transmission failures as a result of overload.

The model, the most powerful so far to wear a Saab badge, is being honed for use as a performance flagship to help underline the big message about ethanol.

‘Having a vehicle like this to show will be a very effective way to demonstrate the point that the fuel it uses is grown and not fossil-based – which makes it CO2-neutral and represents a big step toward conserving oil supplies as well as putting the brake on greenhouse gas emissions,’ said Nash.

Given the enlightened view on environmental matters in Sweden, Saab’s first commercial step in the campaign will come with the launch of 9-5 BioPower 2.0-litre models on the domestic market.

Though the new alternative range will not reach showrooms until June, the ethanol cars are already accounting for 95% of orders – which is not surprising, considering the incentives on offer from the company and the Swedish government, the first to respond to an EU bid for tax cuts on bio-fuels.

Future without fossil fuel use

Saab Automobile chief Jan-Ake Jonsson revealed that the firm will start producing flexible-fuel versions of the 9-3 range next year: "We believe ethanol is a viable step toward sustainable mobility and overcoming our dependence on fossil fuels.

"Cars running on ethanol are governed by the same law of physics as those using gasoline and both emit CO2. But the difference is that burning ethanol effectively recycles the CO2 because it has already been removed from the atmosphere by photosynthesis during the natural growth process.

"In contrast, the use of gasoline or diesel injects new quantities of CO2 into the atmosphere which have lain underground in oil deposits for millions of years. We need to cut fossil CO2 and ethanol can play a crucial role. It doesn’t require the introduction of expensive new technology, cars are already using it and it can be easily distributed within our existing supply infrastructure."

Saab Automobile Powertrain president Kjell Bergstrom said: "Turbocharged engines are well-suited to ethanol and our work leads us to believe there is a great deal of development potential for this fuel. In future, we may well be building ethanol engines that will also operate on petrol rather than the other way round."