Since this is for an automotive class, I'm betting they are looking more for things like fuel economy and power than emissions and production costs.
You could compare biofuels. Biodiesel and ethanol are the big two right now. You could discuss the differences between them in terms of economy and power, as well as some things on how current engine technology would have to change to make use of them. Also discuss how they differ (good and bad) from normal diesel/gasoline. It may be worth looking into other biofuels too. For instance a company in colorado recently announced an engineered strain of algae (I think it was) that can produce iso-butanol (I believe), which can be used in normal gasoline engines and doesn't absorb water (like ethanol does).
You could also go exotic and look at hydrogen fuel cells, modern solar technology, or even pure electric cars. Maybe find out how many miles they get on a single charge and how many kW that is and convert to MPG, then discuss implications in terms of raw efficiency.