Rendered fats have some promise - and there's the added benefit that getting it out of the animal feed chain gets rid of a source of controversy and possible risk.
There was a really interesting piece a few weeks back about a university team with a plan to convert chicken waste into pyrodiesel -- and know, i'm not sure what that is. But the kicker is that it also produces enough methane to fuel the conversion, making it completely self-contained and self-sufficient, and they can fit the plant on a truck, so it can go from farm to farm and not have to transport the doo.
I also saw a story about a cattle rancher who had his own small-scale ethanol plant -- the stalks and leaves went back into the feed, and when they came out of the other end of the cow, he burned the cow flops to fuel the distillation, again making it self-sufficient.
If either of those two approaches takes off, it could have a ripple effect, since both chicken and cow manure are common fertilizers, and a shortage of either could have unforeseen consequences. Now, if they just figured out a way to get energy from pig poo, that woiuld be a breakthrough -- it tends to build up in nasty and even hazardous amounts on big farms.
Prices have collapsed and stock prices have plummeted, but some say these are just normal kinks in an industry with a solid future.
http://money.cnn.com/2007/10/02/markets/ethanol/index.htm