The largest single use of ethanol is as a motor fuel and fuel additive. The largest national fuel ethanol industries exist in Brazil (gasoline sold in Brazil contains at least 20% ethanol and hydrous ethanol is also used as fuel). One method of production is through fermentation of sugar. Ethanol creates very little pollution when burned. Millions more acres of land are needed if ethanol is to be used to replace gasoline. Pure ethanol has a lower energy content than gasoline (about 30% less energy per unit volume).
At gas stations, ethanol is contained in a mix of ethanol and gasoline, otherwise known as gasohol. In the United States, the color yellow (symbolizing the color of corn) has become associated with the fuel and is commonly used on fuel pumps and labels. According to the Renewable Fuels Association, as of November 2006; 107 grain ethanol biorefineries in the United States have the capacity to produce 5.1 billion gallons of ethanol per year. An additional 56 construction projects underway (in the U.S.) can add 3.8 billion gallons of new capacity in the next 18 months. Over time, it is believed that a material portion of the ~150 billion gallon per year market for gasoline will begin to be replaced with fuel ethanol.
Growth in fuel ethanol in the North America is largely being driven by financial incentives that naturally exist when oil prices are over a certain level, as ethanol typically costs under $1.50 per gallon to manufacture (of course this is sensitive to corn prices) and is exempt from the $0.52 per gallon federal gasoline tax. However, the United States RFS (renewable fuel standard) requires that 4 billion gallons of "renewable fuel" be used in 2006 and this requirement will grow to 7.5 billion gallons per annum by 2012.
