Sugar cane is one of the strategic produced crops in the world which is used for the production of bioethanol and sugar. Sugarcane bagasse is the lignocellulosic by-product generated in the sugar and ethanol industry during sugarcane juice extraction. In general, approximately 27% of the sugarcane crop is recovered as sugarcane bagasse (SCB) with moisture content of 40-50% in the sugar production process. The most important biochemical constituents of Sugarcane bagasse consists of cellulose (30%), hemicellulose (23%), and lignin (22%). The annual world production in 2011 for this resource was 1.6 billion tons and it generated 279 million tons of biomass residues of bagasse and leaves. In the same year the production of sugarcane and sugarcane bagasse in Iran were 10 and 3 million tons, respectively.

The peculiar characteristics of SCB, particularly the large amount of carbohydrates in the form of hemicelluloses and cellulose encouraged some researchers not to consider SCB a byproduct or residue of the sugar and alcohol industry, but instead as a high value co-product, which can be used as a raw material for the production of second generation (2G) bioethanol, biogas (CH₄ and H₂) and other bio-products. In Iran about 1.5 million tons of SCB remain unused because of Mismanagement and cause environmental impact annually.

According to a comprehensive carried out survey, anaerobic digestion and combined heat and power have been determined the best way to manage bagasse. Anaerobic digestion (AD) is the biological degradation process of organic substrates in the absence of oxygen. In natural habitat, complex organic substrates need hydrolysis, acidogenesis, acetogenesis, and methanogenesis for completing AD reactions. Anaerobic digestion converts organic substrates into biogas which has the same characteristics of natural gas. Therefore, it could easily be used as an alternative fuel.

Due to the digested output sludge passed the anaerobic condition, it has valuable humus-rich compounds, organic humic and fulvic acids. These organic acids are stable compounds with organic humus which have benefits for the soil and plants. They can increase organic compounds in soil, increase the absorption of nutrients by plants, increase the growth and yield of plants and the preservation of biological soil.

Humic and fulvic acid production from a rich humus compounds source and the appropriate optimization of extraction and purification can be economically and valuable. Currently humic acid market in 2015 valued at 387 million dollars and is expected to reach about 1042 million dollars by the average annual growth rate of 12.1 percent through 2024. Due to the soil in Iran has a poor organic material, recycling organic compounds is a solution to improve the condition of agricultural soils.

The aim of this project is production of valuable products, biogas as biofuel and humic acid and fulvic acid as organic fertilizers, which cause value added. In this project the effect of chemical and biological pretreatment of SCB on biogas production is investigated and the effective parameters on anaerobic digestion are optimized. Also, the humic acid and fulvic acid production and extraction is evaluated from SCB and digested sludge of anaerobic digestion of SCB.