DENVER - Bill Orr got millions of dollars in federal grants and private investment money to develop an alternative fuel, but he faces more than 20 counts of fraud and tax evasion.

A jury began hearing testimony April 1 in a trial that may take months to conclude. Prosecutors say Orr misrepresented his research results and business prospects to investors and to federal grant administrators.

Orr says his legal problems began eight years ago, when he tangled with the EPA.

"I sued the EPA for their bad science," Orr told 9NEWS. "Their (standard for fuel) is going to cost the American public and make the air dirtier."

"The EPA is more interested in destroying (Orr) than in allowing him to pursue the research on his patent," said his friend, community activist Lonnie Haynes. "This was done because he embarrassed the EPA."

Haynes says he has asked the Colorado Congressional delegation to investigate the EPA's actions against Orr.

Orr developed an alternative fuel that he called VPC, for Vapor Phase Combustion. It's a mixture of gasoline and ethanol, with a touch of the metal manganese.

"We thought it would probably result in a fuel that's less expensive to manufacture, with some fuel economy, more miles to the gallon," said Orr. "More importantly, we were trying to clean up the air."

Instead of funding his research through industrial channels, Orr pitched the project to Congress. Sympathetic lawmakers gave him a $3.7 million earmark grant. It's the type of grant that critics often associate with "pork barrel politics." Orr used more than half the money, in part to establish a small laboratory in Golden.

Two scientists who worked on the project disagree about the results.

"The more we measured it, the more we found his fuel was just like any other fuel," said Dr. Tom Reed.

Chemist Frank Cox was more impressed with VPC.

"It was well worthwhile," he said. "The results, to me, indicated we should go to the next step, actual vehicle testing under realistic conditions."

Before Orr could move his research to a larger laboratory, the EPA suspended his grant for alleged mismanagement of the grant money. A year later, a federal grand jury indicted him for defrauding Congress and private investors by claiming that "VPC was superior to conventional gasoline," even though "all scientific testing on VPC failed to demonstrate any benefits regarding emissions or fuel efficiency."

An investor testified in court that Orr's newsletters bragged about connections to big oil companies like Enron and investment banking firms like Prudential-Bache. Prosecutors say those connections never existed.