On the Ethanol Bandwagon, Big Names and Big Risks

Vinod Khosla, one of the founders of Sun Microsystems, now invests in ethanol. The flex-fuel Chevy Tahoe next to him can run on gasoline and ethanol.

By NORM ALSTER, New York Times

Ethanol derived from corn now accounts for 3 percent of the American automotive fuel market. Most cars in the United States can already handle fuel that is up to 10 percent ethanol, and as many as five million are so-called flex-fuel vehicles that can use a fuel called E85, which is 85 percent ethanol and 15 percent gasoline.

The current excitement over ethanol derives from research that has cut the cost of converting nonfood plant matter like grasses and wood chips into alcohol. Mr. Khosla says he believes that such ethanol, called cellulosic ethanol, will eventually be cheaper to produce than both gasoline and corn-derived ethanol

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