First, the energy content of ethanol is low when compared with gasoline or diesel. While diesel contains around 140,000 Btu per gallon, and gasoline 115,000 Btu, denatured ethanol contains only 78,000 Btu per gallon. We can’t cheat physics. These numbers translate into low fuel mileage.
...What could be wrong with using carbohydrates to replace hydrocarbons? Here are some unintended consequences foretold by Peter Huber, an MIT engineering Ph.D.: “To improve on wood-burning fires, or grass-eating cows, perfect the cellulose-splitting enzyme. Then watch what 7 billion people will do to your forests and your grasslands.”
Essentially, he fears if the process for producing cellulosic ethanol becomes cheap and easy in poor countries, it would hasten the conversion of forestlands and other wilderness into a fuel source. Huber concluded: “History has already taught us what a carbohydrate energy economy does to a rich, green landscape -- it levels it.”