Ethanol

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Ethanol basics:
Ethanol is a renewable fuel made from various plant materials, which collectively are called "biomass." Ethanol contains the same chemical compound (C2H5OH) found in alcoholic beverages. Nearly half of U.S. gasoline contains ethanol in a low-level blend to oxygenate the fuel and reduce air pollution. Ethanol is also increasingly available in E85, an alternative fuel that can be used in flexible fuel vehicles. Studies have estimated that ethanol and other biofuels could replace 30% or more of U.S. gasoline demand by 2030.
Several steps are required to make ethanol available as a vehicle fuel—see the supply chain diagram below. Biomass feedstocks are grown, then various logistical systems are used to collect and transport them to ethanol production facilities. After ethanol is produced at the facilities, a distribution network supplies ethanol-gasoline blends to fueling stations for use by drivers.
Ethanol
Ethanol (CH3CH2OH; also known as ethyl alcohol, grain alcohol, and EtOH) is a clear, colorless liquid. Its molecules contain a hydroxyl group (-OH) bonded to a carbon atom. Ethanol is made of the same chemical compound—and it is the same renewable biofuel—whether it is produced from starch- and sugar-based feedstocks such as corn grain (as it primarily is in the United States) and sugar cane (as it primarily is in Brazil) or from cellulosic feedstocks.
Making ethanol from cellulosic feedstocks—such as grass, wood, crop residues, or old newspapers—is more challenging than using starch or sugars. These materials must first be broken down into their component sugars for subsequent fermentation to ethanol in a process called biochemical conversion. Cellulosic feedstocks also can be converted into ethanol using heat and chemicals in a process called thermochemical conversion. Cellulosic ethanol conversion processes are a major focus of U.S. Department of Energy research.
Ethanol works well in internal combustion engines. In fact, Henry Ford and other early automakers thought ethanol would be the world's primary fuel before gasoline became so readily available. A gallon of pure ethanol (E100) contains 34% less energy than a gallon of gasoline.
Ethanol is a high-octane fuel. Octane helps prevent engine knocking and is extremely important in engines designed to operate at a higher compression ratio, so they generate more power. These engines tend to be found in high-performance vehicles. Low-level blends of ethanol, such as E10 (10% ethanol, 90% gasoline), generally have a higher octane rating than unleaded gasoline. Low-octane gasoline can be blended with 10% ethanol to attain the standard 87 octane requirement. Ethanol is the main component in E85, a high-level blend of 85% ethanol and 15% gasoline.
Benefits
Ethanol is a renewable, largely domestic transportation fuel. Whether used in low-level blends, such as E10 (10% ethanol, 90% gasoline), or in E85 (85% ethanol, 15% gasoline), ethanol helps reduce imported oil and greenhouse gas emissions.
Increasing Energy Security
About two-thirds of U.S. petroleum demand is in the transportation sector. Sixty percent of U.S. petroleum is currently imported. Depending heavily on foreign petroleum supplies puts the United States at risk for trade deficits, supply disruption, and price changes. Ethanol, on the other hand, is almost entirely produced from domestic crops today. Its use, and that of other alternative fuels, can displace a significant amount of imported petroleum.
Fueling the Economy
Ethanol production is a new industry that is creating jobs in rural areas where employment opportunities are needed. The Renewable Fuels Association's 2011 Ethanol Industry Outlook report calculated that in 2010 the ethanol industry replaced the gasoline produced from more than 445 million barrels of imported oil. In addition, ethanol production supported more than 400,000 jobs across the country. A recent report claims there is an economic return on investment of nearly five to one for each dollar spent in the form of the federal tax incentive for ethanol use.