One of the uses of ethanol is as a substitute for MBTE which is an anti-detonation or anti-knock compound. Wikipedia article implies that un-subsidized ethanol can't compete with MBTE. I believe MBTE replaced lead in gasoline.
http://en.wikipedia.org/wiki/MBTE"MTBE is a gasoline additive, used as an oxygenate to raise the octane number. Its use is controversial in the US and declining in that country in part because of its occurrence in groundwater and legislation favoring ethanol. Worldwide production of MTBE has been constant at about 18 million tons/y (2005) owing to growth in Asian markets which are less subject to ethanol subsidies."
Not advocating or endorsing anything.
