New Jersey has only allowed distilleries in the state since February 2013, and only two at the time of writing this exist. One of the reasons for the slow increase of distilleries could be the fines associated with owning a still which can be up to 3 years imprisonment.
Because of this I would say it is illegal to own a still, or to use one regardless of the purpose.
33:2-10. Failure to register still; misdemeanor
Any person who shall have in his possession or custody or under his control any still or distilling apparatus set up, dismantled, or in the process of construction, or parts thereof without having registered same in accordance with the provisions of this chapter shall be guilty of a misdemeanor, and punished by a fine of not less than one hundred dollars and not more than one thousand dollars or imprisonment for not less than thirty days and not more than three years, or both.
It shall be unlawful to manufacture, sell, possess with intent to sell, transport, warehouse, rectify, blend, treat, fortify, mix, process, bottle or distribute alcoholic beverages in this State, except pursuant to and within the terms of a license, or as otherwise expressly authorized, under this chapter; but any drink actually intended for immediate personal use may be mixed by any person.
There does not appear to be any legal way to manufacture ethanol fuel in New Jersey. Since it is illegal to manufacture ethanol for personal use, ethanol fuel would also be illegal.
New Jersey offers two different licenses for a distillery
There are several licenses you need to request to legally manufacture spirits. Below are the federal licenses only. Additional state requirements will need to be followed as well.
You must submit a request for a license to manufacture spirits: TTB 5110.41 Basic permit.
This license only allows you to produce spirits. You also need a license for the distilling equipment / distillery: TTB 5100.24 Distilled spirit plant
For manufacturing ethanol fuel you will need to submit a request for a TTB 5110.74 for a federal license.
33:2-10. Failure to register still; misdemeanor
Any person who shall have in his possession or custody or under his control any still or distilling apparatus set up, dismantled, or in the process of construction, or parts thereof without having registered same in accordance with the provisions of this chapter shall be guilty of a misdemeanor, and punished by a fine of not less than one hundred dollars and not more than one thousand dollars or imprisonment for not less than thirty days and not more than three years, or both.
It shall be unlawful to manufacture, sell, possess with intent to sell, transport, warehouse, rectify, blend, treat, fortify, mix, process, bottle or distribute alcoholic beverages in this State, except pursuant to and within the terms of a license, or as otherwise expressly authorized, under this chapter; but any drink actually intended for immediate personal use may be mixed by any person.
Current federal laws allow citizens the right to own a still and operate it for non-alcohol production.
This means legally you can:
It is your responsibility to know the laws in your area.