Environment / Alternative Energy

There are more than 160,000 gas stations in the United States--a daunting infrastructure for a new fuel to fill.

On a brisk morning in early November, the semis are lined up four deep outside the front gate of the Corn Plus plant, waiting before a sign that warns, in big red letters, NO SMOKING. In this corner of sleepy Winnebago, a small town in southern Minnesota, smoke billows from stacks, and a hum from the plant shatters the silence of the countryside. A sour scent, redolent of a brewery, hangs overhead.

The "plus" at Corn Plus is ethyl alcohol, better known as ethanol. In a day Corn Plus takes the kernels of corn hauled by 45 trucks and turns them into 122,000 gallons of fuel. Tank cars wait on railroad sidings behind the plant, ready to carry it to New England, to Chicago, to California.

With the price of crude oil at record highs, times are good at Corn Plus, and the roll is likely to last. The expense of making ethanol has fallen steadily over the last decade, even as some energy analysts predict we might never see gasoline below $3 a gallon again. After a much-quoted warning that "America is addicted to oil" in this year's State of the Union address, President Bush called for "cutting-edge methods of producing ethanol, not just from corn but from wood chips and stalks or switchgrass. Our goal is to make this new kind of ethanol practical and competitive within six years." The ultimate objective: "to replace more than 75 percent of our oil imports from the Middle East by 2025."

It was a remarkable position to take. In Washington, D.C., ethanol is commonly viewed as little more than a sop to the farm lobby. The conventional wisdom has become so entrenched that even fictional politicians embrace it: The presidential candidates on TV's West Wing, campaigning in faux Iowa caucuses, all criticized ethanol. "It takes more oil to transport it and fertilize it than we save using it," griped Representative Russell. Senator Santos complained about the logistics: "Transportation is difficult; storage is a nightmare. . . . Supporting ethanol's a mistake."

Still, the president's initiative was less an announcement of a new endeavor than an acknowledgment of work well under way. Nor is it as ambitious as it sounds; oil from the Persian Gulf accounts for just around 16 percent of U.S. consumption. Yet the researchers who know ethanol best believe that it represents an extraordinary opportunity. With a serious new push, they say, ethanol could displace 30 percent of domestic gasoline consumption within 25 years. Because ethanol is made from plants that pull carbon from the atmosphere as they grow, it could drastically reduce greenhouse-gas emissions from automobiles, the second largest source here, behind power plants. Although President Bush did not say as much, the Department of Energy is also pursuing an even more ambitious outcome—a "biorefinery" that could make not only fuel but also plastics and other products currently derived from petroleum.

Those claims sound less outrageous when you consider that they are being realized abroad right now. In Brazil—a country of 188 million people with the world's 14th largest economy—about 40 percent of the fuel burned in passenger vehicles is ethanol derived from sugarcane. The pump price for ethanol is roughly half that of gasoline. Seventy percent of new cars in Brazil are sold with "flex fuel" engines, which can run on pure gasoline or E85, a blend of up to 85 percent ethanol and 15 percent gasoline, and the Brazilian government has announced that it will wean itself from foreign oil imports completely by the end of this year. All this is happening with a fundamentally American technology: The flex-fuel engine and its precursor—the Model T, which Henry Ford expected to run on ethanol—were invented in the United States.

In fact, ethanol is already creeping into the mainstream. Last year about 1.6 billion bushels of corn were fermented in the United States to produce 4 billion gallons of ethanol, double the amount for 2001. Three percent of all gasoline pumped in this country is actually ethanol, which is often added as a component of low-emission "reformulated" gasoline. Some 5 million automobiles here can run on E85, even though most of their drivers probably don't know it. The Energy Policy Act of 2005 requires the use of 7.5 billion gallons of ethanol by 2012, and the industry is ahead of the target. Thirty-five new plants, capable of producing another 2 billion gallons, are under construction. In small but significant ways, at various labs, factories, and filling stations around the country, an energy revolution is under way.

Rick Lunz's family farm, one county over from Corn Plus, is one of the patches where the new ethanol economy has sprouted. I pull up to find him loading grain into silos.

He had already spent about eight hours in the cab of his John Deere 9650 STS combine. We climb back inside, and Rick's brother Bob fires it up. Soon sturdy six-foot-tall corn falls before our advance, eight rows at a time. Pieces of stalk, leaves, and cobs dance as the kernels disappear underneath, but inside the sealed cab the noise of corn gnashed by steel teeth barely registers. It takes about three minutes to complete a single quarter-mile pass, then Bob swings the combine around again. A truck pulls up alongside, he flips a switch, and grain pours from the combine bin behind into the truck. This is not your father's farming operation. Perhaps that's why Lunz, who is 49, still has a boyish face.

In 1979, when ethanol was called gasohol, Lunz saw an ad in a newspaper for an on-farm ethanol plant. The energy crisis of 1973 was still fresh in his mind. President Jimmy Carter had persuaded Congress to pass a law promoting synthetic fuels, which included tax credits to ethanol producers. Lunz ordered a kit that could produce 150,000 gallons a year: "It took me a long time to get it built. I ran it for three months." Lunz lets out a hearty laugh. Then President Reagan ended the incentives, and Lunz couldn't make the payments. "I turned around and ripped it down and sent it on to somebody in Nebraska. They had a state program, and we didn't."

By the mid-1980s, Minnesota had a program too. A tax credit buoyed ethanol to about 4 percent of Minnesota's gasoline supply. When Lunz began meeting with a group of farmers near Winnebago in 1991, they could count on a state-sponsored cash payment of 20 cents per gallon, up to $3 million a year. Lunz and his associates eventually raised $13 million—about half the construction costs—to build an ethanol plant they named Corn Plus. The plant opened for business in November 1994, with the capacity to make 15 million gallons of ethanol a year.

Production has since tripled. Legs, drags, and augers convey corn kernels into storage bins and then to a pair of hammer mills that crush them into a fine powder. In the mix tank, the milled grain takes on water and enzymes, which begin to convert the starch to simple sugars. Eventually, the slurry arrives at fermentation tanks, where yeast goes to work on the sugars. Over the next 54 hours, the corn slurry becomes a mash containing 15 percent alcohol. The alcohol is stripped away at the still; molecular sieves then pull out the last drops of water. Finally, the ethanol—2.7 gallons from a bushel of corn—is cooled into a liquid and denatured with gasoline. The mash at the bottom of the still is dried and sold as an animal feed called distillers' grains.

Outwardly, the way ethanol is made has not changed much, but each step of the process has grown markedly more efficient, beginning with the farmers. Lunz, for instance, says his fields produce about 175 bushels per acre, 25 more than a decade ago, while using 25 to 30 percent less fuel.

Corn Plus started out as a farmer's co-op. Now it is the third-largest ethanol supplier in Minnesota, the most ethanol-friendly state.

Corn Plus has contributed significant advances of its own. Engineer Gregory Coil hands me a pair of earplugs and leads me into a room dominated by a giant stainless-steel cone that calls to mind an old steam locomotive's smokestack. This is a fluidized bed reactor, an energy-generation technology that has been used for decades to power paper mills and waste-treatment plants but that had never before been installed in an ethanol plant.

Every minute, 80 gallons of the corn syrup left over from distillation are pumped into a bed of 1300-degree sand agitated by compressed air so that it behaves like a liquid. The sand ignites the syrup. "Syrup solids have a BTU content similar to lignite coal," Coil says over the roar of combustion. "When it burns, when it oxidizes, it produces heat." The heat generates steam for boilers and dryers. The fluidized bed reactor has cut the plant's natural gas use by more than half. A new heat-recovery system may further reduce natural-gas consumption to just a third of what it was two years ago.