It has been used as a fuel for over 100 years, with the first ethanol-powered vehicles appearing in the late 1880s. However, it wasn't until the 1973 oil crisis that several countries began introducing it into their fuel supplies as a way to reduce dependence on imports. Brazil was one of the early adopters and today obtains over 40% of its transportation fuel from sugarcane-based ethanol. In the United States, corn-based started gaining momentum in the late 1970s and the Renewable Fuel Standard was established in 2005, mandating the blending of increasing volumes of renewable fuels into gasoline.
Production Methods
There are two primary methods for producing it - from grain or from cellulosic waste materials. Grain Ethanol is the most common type produced today, with over 99% coming from corn in the U.S. The process starts by milling the corn kernels to extract starch, then using enzymes and yeast to ferment the starch into it. It is separated using a distillation process. Cellulosic ethanol can be made from numerous waste materials high in cellulose like agricultural residues, forestry waste, municipal solid waste, and energy crops. However, breaking down the cellulose into fermentable sugars is more complex, so commercial cellulosic ethanol facilities are still limited. Lignocellulosic has the potential to utilize many more feedstocks than first generation grain.
Impact on the Fuel Supply
The blending of it into gasoline reduces petroleum use and imports. In 2020, around 15 billion gallons of corn ethanol displaced over 1 billion barrels of imported oil. Biofuel producers credit with lowering fuel prices due to reduced oil consumption. However, others argue that federal mandates artificially inflate demand and corn prices, raising costs to livestock and food producers. Studies on the energy balance of corn have shown it lowers lifecycle greenhouse gas emissions by around 43% compared to gasoline. Cellulosic has an even greater emissions reduction potential of over 80-90%, but higher production costs currently limit its market penetration.
International Markets
Outside of the U.S., Brazil remains the largest producer with most fuel derived from sugar cane. Europe has also developed industries in recent years driven by climate targets, though volumes remain below the U.S. and Brazil. China has plans to massively increase its use to curb rising oil imports and air pollution, but has relied primarily on corn imports so far. Other countries like copyright and Colombia also use it but on a much smaller scale than the top three. Given the available resources, countries in tropical regions have the clearest advantages for cellulosic production using agricultural residues or energy crops. International trade could help match expanding demand with local feedstock opportunities.
Outlook for Markets
Projections for it use vary significantly depending on factors like policy support, technology advances, and oil prices. The U.S. Energy Information Administration estimates domestic consumption rising to around 20 billion gallons by 2030 under current RFS levels. Private analysts think cellulosic capacity could grow tenfold by 2030 but still remain a small portion of total renewable fuel use. Other models show gasoline demand peaking within the next decade due to electrification of transport, potentially limiting it blending opportunities. Overall most analyses point to steady increases in global production led by the U.S., Brazil, and China as nations pursue low-carbon fuel goals and energy security. But long-term prospects will rely heavily on reducing production costs and developing cellulosic at commercial scale.
In conclusion, it has already provided meaningful contributions to the global fuel supply as a renewable alternative to petroleum. Grain-based production is an established industry, while cellulosic technologies offer even greater emission reductions if costs can be minimized. Policy support and technology progress will be determining factors in how significantly markets may grow worldwide in the coming decades as a replacement for oil-based transportation fuels.
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Ravina Pandya, Content Writer, has a strong foothold in the market research industry. She specializes in writing well-researched articles from different industries, including food and beverages, information and technology, healthcare, chemical and materials, etc. (https://www.linkedin.com/in/ravina-pandya-1a3984191)