Does the cost of ethanol make it a viable petroleum substitute?
Ethanol still costs more to produce than gasoline, but the cost to produce it has dropped substantially over the past 15 years.19 An August 2002 report by the USDA’s Office of the Chief Economist found that increased corn yields and technological efficiencies in how corn is converted into ethanol in recent years has made ethanol production much more efficient than in the past.20 The report said ethanol production now yields 34 percent more energy than is used in growing and processing corn. It is believed that biotechnology can be used to dramatically reduce ethanol production costs even more by using low-cost biomass feedstocks such as agricultural and forest residues, prairie grass, kudzu, waste wood, used paper products, and even urban waste.
