Alkaline oxidative fractionation of woody materials and sugarcane bagasse was developed. The enzymatic hydrolysis of alkaline oxidised materials worked well even with low enzyme dosages and at high dry matter conditions. The resulting ethanol yield was on a high overall level. Process concepts were developed based on the results and the estimates of the feasibility of the process were calculated. The results clearly showed the promise of the new fractionation method, but also indicated the key challenges in scaling up the technology to full industrial scale.