Ethanol has numerous advantages that increase its potential as an alternative car fuel. Probably the most important advantage of ethanol is that is can be created through the fermentation of starch or sugars present in biomass, mainly grain crops such as corn, sugar cane and wheat, which are renewable sources. This demand for grain crops created by the ethanol industry increases crop value and offers enormous potential for economic growth in small rural communities. In the U.S.A. the ethanol industry is responsible for more than 40000 direct and indirect jobs, creating more than $1.3 billion in increased household income annually and adding more than $6 billion to the American economy each year. .
The production of domestic ethanol reduces demand for imported oil, which drains the economy. Instead, ethanol production generates exports of feed co-products such as corn-gluten and by-products of the fermentation process such as corn oil and high protein animal feed supplements. Because there is a decreasing supply of fossil fuels on earth, the use of ethanol as an alternative, helps to extend the life of the petroleum supply on earth. Ethanol is a safe replacement for toxic octane enhances in gasoline and does not increase atmospheric carbon dioxide levels. The carbon dioxide formed during the combustion of ethanol is balanced by that absorbed during the annual growth of plants used to produce ethanol. .
Ethanol is low in reactivity and high in oxygen content, making it an effective tool in reducing the levels of ozone pollution. Similarly, ethanol reduces carbon monoxide and other toxic hydrocarbon like benzene emissions. Ethanol does not prematurely combust when exposed to heat and pressure. This advantage increases the performance of vehicles and lowers the amount of pollutant emissions. Ethanol's high solubility means it will disperse rapidly and will evaporate quickly when spilt on land.