There are several problems with E85 type fuels.

A. Current U.S. mass production of ethanol is based on corn.
1. Ethanol-power equivelents from corn is a negative energy process (takes more energy to make than you get).
2. There isn't enough irrigated crop land or chemical plants available in the U.S. to produce enough corn to switch everyone over to E85.
a. #2 *might* be overcome if switching ethanol production over to other sugar/startch sources can be accomplished. Breakdown of plant waste-stock cellulose to sugar would help tremendously, but that technology isn't ready yet. Design/construction/fighting enviromentalists over new chemical plants also takes time, usually ten years (oil refineries currently take 30+ years to get approval).

B. 5% or greater ethanol in gas is an electrolytic fluid (translation: is conducts electricity). When two dissimilar metals are in contact through a conductive solution galvanic corrosion occurs (translation: E85 fuel causes causes engine components to rot away). Flexible Fuel Vehicles have engine and fuel line components made of special corrosion resistant alloys to prevent this. Most cars on the road today would end up needing major repairs after a year of E85 fuel. Oil companies don't want to have to buy everyone new cars.

C. Oil company "profits"
1. The news loves to report how Big Oil has made record profits this last year. What they don't tell you is this "profit" is the number BEFORE their costs are taken from it. Their actual "in the pocket" profit is under 8 cents per gallon of gasoline (meanwhile, the government takes forty-four cents). They have a return on investment of 7.3% which is dead-average with all companies in America. They are pulling in lots of money because everyone is using boatloads of their product, but it costs them a fortune to keep the oil flowing. Their profit margin is equal to Radio Shack's and lower than Starbucks.

So, my solution? Coal!

We have TONS of coal. During WWII the Germans converted coal into gasoiline via the very expensive process. The U.S. had started working on developing cheaper ways of making coal into gas back in the 70's, but that research was put on the shelf when oil prices plummeted. Remember back in the late 90's/early 00's when gas was under a dollar? Tens of thousands of people in the oil industry lost their jobs. Well, coal-to-gas is back on the front Bunsen burner again and will remain there while gas prices are high. However, if the prices drop before a breakthrough occurs then money for research will dry up.

There is not instant replacement for oil that cost LESS than oil. Work is being done, but the technological/economic hurdles are HUGE.

-Blast