On January 5, 1981, President Jimmy Carter signed Executive Order 12261 – Gasohol in Federal Motor Vehicles. This was intended to increase the use of “gasohol,” which is roughly defined as a gasoline blend with 10% anhydrous ethyl alcohol “derived from biomass.”
Since then, use of ethanol in fuel consumption has risen dramatically:
The reasons for increasing US use of ethanol in motor fuels range from energy independence and national security to reducing the Nation’s CO2 footprint. However, ethanol is not a direct substitute for gasoline, and there are technical challenges that restrict its use. High concentrations of ethanol can be corrosive and volatile, making it impractical to transport via pipeline and limited to use in vehicles that are made with corrosion resistant fuel systems. Further, ethanol contains only about two thirds of the energy content of gasoline.
However, ethanol is not the only aliphatic alcohol we can burn. Butanol is a 4 carbon alcohol (C4H9OH vs ethanol’s C2H6O) that can be made from the same materials currently being used to produce ethanol in the US. BP and Dupont have formed a 50/50 venture to produce butanol (marketed as Butamax) and sell it as the preferred biofuel alternative. Butamax expects to begin commercial production in 2014.
Unlike ethanol, butanol can be transported using existing fuel pipelines. Also, the current stock of vehicular internal combustion engines could potentially run entirely on butanol, without the need to blend gasoline at all.
Further, while ethanol has around 84K BTUs per gallon, butanol has 105K BTUs per gallon (which is much closer to the ~114K in a gallon of gasoline).,
At present, it costs around 25% more to produce a gallon of butanol vs a gallon of ethanol, according to the Butamax CEO. This should not be a cause of concern, because butanol yields 25% more BTUs per gallon. So, butanol currently costs around 2.96 cents per thousand BTU (same as ethanol), and gasoline (at $3.76/gal) is 3.3 cents per thousand BTU.,
If Butamax and other producers are able to reduce that cost spread over the cost of ethanol as production scales up, then the price per BTU advantage over gasoline will continue to increase, and as a “drop-in” alternative – butanol may soon be every politician’s darling biofuel of choice.
 Gasoline Gallon Equivalent: http://en.wikipedia.org/wiki/Gasoline_gallon_equivalent
 AEO2012 EARLY RELEASE OVERVIEW. Table 12. Petroleum Product Prices. http://22.214.171.124/forecasts/aeo/er/tables_ref.cfm
 Daily National Average Gasoline Prices Regular Unleaded. http://www.bloomberg.com/quote/3AGSREG:IND