But after years of fluctuation in oil prices and availability, the government decided on using a blend of gasoline and ethyl alcohol (15%), designated E85. Finding out how this decision was made is not easy to come by, as there was an agricultural commodity involved, and the associated expectation of great profits for someone. It is clear now that the decision was flawed and is now hard to correct. The intended consequence was that the use of alcohol would be cost effective and reduce our dependance on oil. Politicians and lobbyists welcomed the cash bonanza to come.
But, here is the bad news: It costs more to produce ethanol from corn than gasoline costs; The expense to ferment corn into alcohol requires more land to grow the corn, increased use of water, pesticides, transportation, and ironically, the fossil fuels costs that are used for the tractors and trucks to transport the corn and subsequently, the alcohol. Additionally, the subsidies to grow corn are in the billions of dollars. And what happens to the farmers? As demand increases, more farmers grow corn, and the supply lowers the price of corn and the farmers are stuck yet again. And to top it off, ethanol degrades by adsorbing water forming an azeotrope.
So, what is the future of corn alcohol? Unfortunately it is bright, despite the problems. There is too much money at stake to lose it now. The newest idea is to use cellulosic materials like grass and woodchips. Another panacea to sidetrack our energy needs. And think of the farmland that could be used to grow edible foods! If we put our billions in subsidies into electric cars and solar, we would stand a chance of seeing some change in our long term energy problems. It looks like the "free market" is not free after all.