Concerns over global warming, carbon monoxide pollution and ozone formation are forcing a fundamental shift in the role of alternative fuels and fuel additives in Western Hemisphere markets. In the U.S. Clean-Air Act legislation mandates the use of cleaner burning fuels. Ethanol is the primary renewable liquid fuel alternative. There are two major ethanol country programs in the Western Hemisphere. The U.S has a modest, highly subsidized, high cost trade-protected corn-based industry. Brazil has a larger, lower-cost, excess supply, sugarcane-based ethanol program. This project focuses on the compilation of a domestic database suitable for research into the viability of alternative liquid fuels. The demand analysis is restricted to the U.S. market to be met by both domestic and imported supplies. Supply and demand changes in response to Clean-Air Act legislation are estimated. Alternative domestic subsidy and import policies are explored within a cost-benefit framework. Polices benefitting consumers, producers, and governments with ever tightening budgets are proposed and evaluated.
