Ethanol and Methanol

Ethanol and methanol as biofuels
Ethanol is a alcohol from grain, sugar, or cellulose. There are several ways to make it, the most common is fermenting and distillation which is initially the same process as making liquor, but it uses a plate distillation column to get the last 10% of the water out.

How can we use ethanol and methanol
Ethanol can replace gasoline in Flexible Fuel Vehicles (FFV's) and gasohol can replace it in all cars. Methanol can be burned, mixed with other substances, and have its contents extracted.

How they're used today
There are two kinds of ethanol: E10, which has 10% alcohol ethanol and 90% petroleum and is know as gasohol, and E85, which has 85% ethanol and 15% gasoline. E85 can replace gasoline in FFV's. E10 is used as a gasoline oxygenator in gasoline with no modifications. (typical modifications are carb adjustment and non-corrosive usually stainless steel fuel lines, instead of plastic fuel lines which were introduced in the 70s to save weight in vehicles). Henry Ford originally planned to use ethanol in his Model T's, but when huge quantities of petroleum were discovered, the production of ethanol became more expensive than that of petroleum refining. Ford even called ethanol "the fuel of the future". Methanol is rarely burned in combustion engines, but a methanol blend is the fuel used by some open wheel race cars and flying model airplanes. Methanol is sometimes used as antifreeze, and formaldehyde is often extracted from it to make paint and plastics. Methanol and isobutylene are used to create the oxygenator known as MTBE (methyl tert-butyl ether) ingredients used to be a gasoline additive, but most states have banned this for being carcinogenic and could significantly pollute water if it leaked.

Disadvantages
Alcohol is expensive to create, however, it can be cheaper then gas from oil. Methanol can really not be used for much as a fuel, it is widely used as a chemical in many chemical processes.