Just for the record, I believe that ethanol is still a really good option to replace oil. There are lots of environmental, food supply safe, politically correct ways to make it and sell it cheaply.

Having said that, ethanol no longer seems to be the "It Fuel," probably due to the PR hits it has taken lately. The new hip fuel is butanol. And by "hip" I mean heavily backed by research and funding.

Butanol has a higher energy balance than ethanol, is less corrosive and transports more easily. However, it is still prohibitively expensive and is made from either food stocks or fossil fuels. BP and DuPont have sunk major financial resources into making butanol work. Though still trying to figure out ways to make it cheaply, they are opening production facilities anyway. These companies are going after butanol the way GM is going after the Volt.

Butanol is quirky because, while it has a higher energy balance, more feedstock is required to make it, which partially cancels out that benefit. It takes more energy to produce because production includes two familiar byproducts -- yeast and ethanol. Hey, maybe if these companies really get it right, they'll be able to produce butanol and ethanol from a single process!