Vat difference - Moulton Brewing Co. hopes to make its name with "healthy" beer.

My first beer of the day is at about 8:30 a.m. The honey-colored head of the Helles Lager foams up as I swish it in my glass. I'm one of the first to sample the work of the Moulton Brewing Co., a new craft beermaker honing its product in a 46,000-square-foot warehouse on Midtown's Prospect Avenue. These are beermakers with street cred: Brian Lottig and partner Terry McKenna worked at Great Lakes Brewing Co. before striking out on their own.

"There is more demand for craft beer than there is product," McKenna explains. We're seated at a makeshift table as Lottig, the brewmaster, serves up samples in plastic cups, pouring from a Frigidaire in the corner. Moulton's strategy, McKenna continues, is to tap into the rapid growth of the craft beer market in Northeast Ohio, which reflects a nationwide trend.

Lottig and McKenna were a part of Great Lakes' expansion; the Ohio City brewery now turns out 60,000 barrels per year. Nationally, the craft beer market has grown 32 percent over the past three years (it's now 3.2 percent of the beer market, according to the US Brewers Association). Major labels like Anheuser Busch are getting into the game, buying up local brewers to gain market share.

Still, can Cleveland support two separate breweries?

"We don't view ourselves as competing with Great Lakes, so much as the import market," McKenna argues. In addition to the Helles Lager, Moulton is launching a pale ale - it's hoppier than a lager, but less so than the trendy, high-alcohol-content beers now ubiquitous in the US. Moulton's two products are also a bit different from the brews that are currently offered by Great Lakes. Lottig and McKenna anticipate brewing about 3,000 barrels in their first year, and expect that a six-pack will sell for about $7.99 in the store.

And while there are additional brew pubs in Cleveland - Rocky River, Rock Bottom, Willoughby and Buckeye Brewing among them - they sell their beer on site, with varying degrees of distribution. Moulton does not plan on opening a restaurant or a bar, though Lottig is hoping to offer a small tasting room at the brewery. They're focusing on distribution to bars, restaurants and stores.

Julia Herz, director of craft beer marketing for the US Brewers Association, says that several US cities boast two or more major breweries, including Boston; Denver; Portland, Maine; and Fort Collins, Colorado. In fact these cities have tried to brand themselves as being homes to vibrant beer markets.

Moulton also claims to offer a beer that is not only good for you, but actually leaves you with less of a hangover. It's more than just a low-carb knockoff, the brewers say, and they're serious enough to have engaged a patent lawyer. But the legal process may also push their launch date into 2008.

"We're going to produce a good beer with health benefits," says Lottig. "And we don't plan on compromising our quality, or producing a beer that tastes like a multi-vitamin." Beyond saying that it will have a "reduced impact on the liver," Lottig is tight-lipped about his secret recipe and its supposed benefits (the federal government prohibits beer makers from making such claims, however scientifically sound).

Lottig has long wanted to start his own brewing company, but the current venture began to take shape after he met Natasha Moulton-Levy. From her home in Maryland, Moulton-Levy read about Lottig and his work in the College of William and Mary alumni magazine, a liberal arts school in Virginia that they had both attended. Moulton-Levy, a health care consultant, had wanted to start a business. She contacted Lottig, and the idea for Moulton was born.

"We are very excited, because no one has a concept quite like this," says Moulton-Levy. "With his experience at Great Lakes, I believe that Brian is the one to make this happen."

It's difficult to predict whether Moulton's healthy beer concept will find a market, but the brewery is definitely riding a trend in American tastes. Organic and natural foods have become decidedly mainstream in recent years. Some companies have started producing organic wine and beer; The New York Times recently ran a feature story on the use of natural fruit in cocktails.

THE GROWTH OF CLEVELAND'S beer market is part of a larger national story about a changing beer industry. Throughout the 1800s and early 1900s, regional breweries flourished in America; there were 30 in Cleveland in the 1870s. But many never re-opened after Prohibition, and those that did struggled to compete with assembly-line production. By the 1980s, the American beer market was dominated by Miller, Coors, Bud and Pabst.

"I spent some time in Rome after college, and I tasted the great beers of Europe," recalls Pat Conway, who together with his brother Dan runs Great Lakes Brewing Co. "I wondered, why don't American brewers respond to the change in the American palate? The whole country was getting a terminal case of the blands - all you could get was Budweiser and Wonderbread! We felt that it could be a niche to make European-quality beers in our own backyard."

Great Lakes has come a long way from the days when the Conway brothers hand-bottled six-packs and delivered them in their cars. Today, Great Lakes is the 26th largest craft brewer in the country (41st among all beer makers), according to the US Brewers Association. With business up 50 percent since last year, according to Conway, and beer sales going in nine states, their biggest problem seems to be accommodating demand. At the moment, having outgrown their Ohio City headquarters, they're storing beer in a rented warehouse on Canal Rd. in the Flats.

In the next few years, Great Lakes will roll out an expansion plan to keep up with that demand. Pat Conway says that they are looking seven to nine years out, with a goal of being able to produce 120,000 barrels a year (double their current capacity). To pay for the expansion, they are borrowing up to $8.4 million through a Cuyahoga County program. The expansion will help to create, among other things, more storage space and new loading docks.

Great Lakes owes its success in part to the upswing of the craft beer market. Savvy marketing, quality product and an innovative green business model (they use natural products and recycle their waste, all the way down to growing mushrooms from their barley and hops) have all helped. Their restaurant across from the West Side Market has become an Ohio City destination.

Asked whether, given the growing demand for craft beers, another brewer could thrive in Northeast Ohio, Conway is tight-lipped. "In theory that's true," he says guardedly, and shrugs. "After all, there were once over 30 breweries here...."