This article does a good job of explaining how an engine can be designed to take advantage of ethanol's properties to wipe out the usual fuel economy penalty. This kind of technology could be revolutionary.
AutoSpeed - Going Direct Injected Turbo Ethanol!: "When operated on ethanol blends such as E85, current flex-fuel engines pay a fuel economy penalty of about 30 per cent compared to gasoline. The EBDI engine substantially improves ethanol's efficiency, and performs at a level comparable to a diesel engine."
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