Ethanol is a nice stopgap but it's not the end-all-be-all. As has been pointed out, it does not produce nearly as much energy per unit as gasoline does. However, as long as the special intrests do their job we're going to see this as the only viable alternative in the near term.

Most of the midwest has ethanol blended into it's gasoline already. I don't like it. I've found it reduces my car's efficiency by about 4mpg. Another thing I don't like is how it drives up costs. St. Louis uses a different blend than the outlying areas. Just across the river in Illinois they use yet a different one as well. Within a 100 mile radius you have about 6 different formulas. That's absurd.