Long post, shortening for quote.
Wrong on all counts.
The fuel economy of the Tahoe dropped 27 percent when running on E85 compared with gasoline, from an already low 14 mpg overall to 10 mpg (rounded to the nearest mpg). This is the lowest fuel mileage we’ve gotten from any vehicle in recent years.
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When we calculated the Tahoe’s driving range, we found that it decreased to about 300 miles on a full tank of E85 compared with about 440 on gasoline. So you have to fill up more often with E85.
You could expect a similar decrease in gas mileage in any current FFV. That’s because ethanol has a lower energy content than gasoline: 75,670 British thermal units per gallon instead of 115,400, according to the National Highway Traffic Safety Administration. So you have to burn more fuel to generate the same amount of energy. In addition, FFV engines are designed to run more efficiently on gasoline. E85 fuel economy could approach that of gasoline if manufacturers optimized engines for that fuel.
According to a 2005 report issued by the Agriculture Department, corn ethanol costs an average of $2.53 to produce, or several times what it costs to produce a gallon of gasoline. Without the subsidies, costs would be higher still. A study last fall from the International Institute for Sustainable Development found that ethanol subsidies amount to $1.05-$1.38 per gallon, or 42 percent to 55 percent of ethanol's wholesale market price.
According to a group of academics from UC Berkeley who published in Science magazine last year, 5 percent to 26 percent of the energy content of ethanol is "renewable." The balance of ethanol's energy actually comes from the staggering amount of coal, natural gas and nuclear power necessary to produce corn and process it into ethanol.
Petroleum subsidies are something less than $1 billion a year – six to eight times less than ethanol subsidies – and work out to about 0.3 cents per gallon.
What's causing grocery bills to rise? Some blame policies that have made it especially profitable for farmers to divert their crops into corn for the production of ethanol. "The ethanol industry is hogging more and more of the corn supply, and that is squeezing ranchers and dairy farmers," says Daniel Griswold, director of the Center for Trade Policy Studies at the Cato Institute, a Washington, D.C., think tank.
All sources cited:
Ethanol Makes Gasoline Costlier, Dirtier
Subsidies and High Crop Prices - US News and World Report
Ethanol Subsidies, State and Federal
ConsumerReports.org - Ethanol 10/06: E85, alternative fuels, flexible-fuel vehicles