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In the public and scientific debate on biofuels, ethanol from lignocellulosic biomass is generally the most popular alternative that may allow for a sustainable production. Compared to thermochemical processing of biomass which assures a complete conversion of the feedstock, it yet suffers from an inherently lower fuel yield due to the resistance of lignin to biological degradation. Based on a recently developed process model for fuel ethanol production from lignocellulosic biomass, this paper discussed the cogeneration alternatives for the conversion of the residual lignin. Whereas an integrated gasification combined cycle (IGCC) increase the power cogeneration efficiency compared to the conventional combustion and power generation in a steam Rankine cycle, it is shown that alternative gasification and methanation to Synthetic Natural Gas (SNG) allows for roughly doubling the fuel yield from biomass. The paper further demonstrates the paradox situation that conventional energy recovery is limited by the available energy, and not, as usually, the available exergy from the waste heat. In order to overcome this limitation, a more general energy integration approach that allows for increasing the cogeneration efficiency in this kind of situations is proposed.