under construction that produce ethanol and biodiesel relative to U.S. state population densities. As discussed later in this chapter, there is an ethanol-compatible infrastructure for transporting ethanol to markets today for the relatively small volumes produced. However, if the ethanol markets increase rapidly over the next decade, the lack of delivery capacity and the complexity of constructing it will challenge the industry.

As of 2008, most of the ethanol produced is blended in gasoline at up to 10 percent by volume; such ethanol-containing gasoline is designated E10. There are few outlets for higher ethanol blends, such as E85; close to 15 percent gasoline (by volume) is blended with pure ethanol for several reasons, for example, to improve vehicle cold-starting. If E10 fuels were sold at every refueling station in the United States, about 15 billion gallons of ethanol would be consumed each year. If the United States plans to produce about 40 billion gallons of cellulosic ethanol each year to improve energy security and to reduce carbon emissions, the number of E85 refueling stations will have to be increased to more than the 1900 stations that exist in 2008.

More than two-thirds of the quantity of U.S. petroleum products is shipped via pipeline, and the rest via barge (27 percent), truck (3 percent), or rail (2 percent) (Booz Allen Hamilton, 2007). Ethanol is not compatible with existing petroleum pipelines; it can damage pipeline seals and other equipment and even induce cracking in pipeline steel (Farrell et al., 2007). The pipeline industry, however, is considering dedicated pipeline for ethanol as an option (as discussed later in this chapter).

A typical ethanol-distribution system is shown in Figure 5.2. Typical ethanol transportation fuels are E10 and E85. As shown in the figure, truck transportation is the critical last step in the system (transportation from blender to fueling station). It is unlikely that any other mode of transportation will replace trucks at this stage in the distribution system, because trucks are the most economical mode of short-range transportation.

If larger volumes are to be carried between biorefineries and blending stations, however, there could be several competing modes. A next-generation ethanol plant taking in 4 million tons of biomass per year would produce 30,000 bbl of ethanol per day. One inland barge would transport about 30,000 bbl (1.3 million gallons) of denatured ethanol, one railroad car about 750 bbl (33,000 gal),