Any chemist could have told you flat out

That ethanol is a ridiculous energy source. It is too small a hydrocarbon to produce much heat. The energy expended to till, fertilize, grow, harvest, take to the factory, change into ethanol, drive the ethanol to the gas refineries and then to the distributors will always be more than what we gain from using ethanol. They've even opened a coal-run plant to make ethanol. It's letting the farmers get some quick cash, but that's about it:

Ethanol fuel made from corn may be being "dangerously oversold" as a green energy solution according to a new review of biofuels.

The report concludes that the rapidly growing and heavily subsidised corn ethanol industry in the US will cause significant environmental damage without significantly reducing the country's dependence on fossil fuels.

"There are smarter solutions than rushing straight to corn-based ethanol," says Scott Cullen of the Network for New Energy Choices (NNEC) and a co-author of the study. "It's just one piece of a more complex puzzle."

The report analyses hundreds of previous studies, and was compiled by the environmental advocacy groups Food and Water Watch, NNEC and the Vermont Law School Institute for Energy and the Environment. The study was released as the US Congress debates key agriculture and energy laws that will determine biofuel policy for years to come.
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Yet, even if all corn grown in the US was used for fuel, it would only offset 15% of the country's gasoline use, according to the study. The same reduction could be achieved by a 3.5-mile-per-gallon increase in fuel efficiency standards for all cars and light trucks, according a federal figures cited in the report.

And using corn-derived ethanol does not necessarily even reduce greenhouse gas emissions. A number of recent studies have attempted to assess the total carbon footprint – from the field to the tailpipe – of the biofuel. Conclusions vary widely from being worse than gasoline to being about the same.
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"Corn-based ethanol hasn't been pursued because this is the best solution, it's been because this has been what's been pushed the hardest," Cullen says. The recent survey notes that Archer Daniels Midland, the largest US ethanol producer, received $10 billion in federal subsidies between 1980 and 1997.

But Brian Jennings, of the trade group, the American Coalition for Ethanol, disagrees. "We can release papers until we are blue in the face about what is theoretically going to be the best alternative to reduce our dependence on fossil fuels and to reduce carbon emissions," he says. "But, from a practical standpoint, we have to start somewhere, and corn-based ethanol is the most viable alternative fuel on the planet today."

The current Farm Bill, which provides $16.5 billion in federal agricultural subsidies each year, will expire in September 2007. Proposals for a new Farm Bill are likely to include significant subsidies for the continued development of both corn-based ethanol and cellulosic ethanol.

Update: Phila of Bouphonia addresses the concerns Iowans have about the huge demand on water aquafiers that the ethanol business is having, besides being worried about field runoff and contamination.