.png?width=300&name=26-ACE-0830_Email_Header%20(1).png)
Producers eye branching into aviation, marine fuel, heavy-duty transport, and bio-based products to power the next phase of growth.
By: Susanne Retka Schill
Long-term projections call for continuing declines in gasoline use and continuing increases in corn production. So, while year-round E15 and domestic fuel policy remains central to the ethanol industry, the ethanol sector increasingly looks to markets beyond the traditional light-duty gasoline pool. From ocean-going ships, airplanes and heavy-duty engines to bio-based plastics and chemicals, ethanol is emerging as a versatile low-carbon feedstock.
The ultimate 10- to 20-year growth pathway will be sustainable aviation fuel (SAF), says Neal Jakel,
president of Fluid Quip Technologies (FQT). One that is likely to transcend decarbonization efforts. “There’s no doubt about that growth potential because you can only get so much jet fuel from a barrel of oil—it’s 8 to 10% max. And we’re not processing more barrels because we’re not driving as much and we’re more fuel efficient. We’re going to have a gap because flight continues to grow, jet fuel continues to grow in demand.”
Ethanol-to-jet has a long-term future helping fill that gap, he suggests, with the biggest obstacle holding it back being capital cost. “Ethanol to SAF competes opex-wise with petroleum based,” Jakel says. “It’s the cost of capital that is the penalty. If you could figure out how to incentivize that, that’s the key to getting that market going quicker.” [KM1]
Powering Tractors
While SAF is most likely the biggest new market, other potential new uses are attracting attention—one which could power corn production in the future. John Deere’s prototype mid-300 horsepower E98 tractor garnered lots of attention at the Commodity Classic earlier this year, sparking interest in ethanol circles as well.
John Deere started evaluating alternative fuels in 2020 in response to the growing push for carbon reduction, explains Buddy Kavalier, research strategist. While biomethane and hydrogen were options, they quickly determined farmers need a liquid fuel. “The fuel is different than on-road; this fuel goes to the field,” he says. And, with renewable diesel and biodiesel expected to be limited by feedstock availability in the future, ethanol was the route selected for development.
The pure ethanol route was chosen for two reasons—its higher energy density per acre and the oversupply of corn. They didn’t go the route of blending ethanol into diesel, he adds, because the fuels tend to separate due to their different polarities, although biodiesel wouldn’t face that limitation.
Another advantage for ethanol is its clean-burning characteristics. “Effectively, we can simplify the after treatment,” he says. Using E98 in a spark ignition engine means they can treat the emissions with a catalyst, much like automobiles, eliminating the need for diesel exhaust fluid (DEF). “DEF is a bit of a pain point because it’s another fluid you have to handle and then there’s a lot of additional sensors and controls to manage the system.”
A downside for ethanol is its lower energy density compared to diesel, requiring 1.72 gallons of ethanol for the same amount of work gained from 1 gallon of diesel. That didn’t emerge as an issue, however, for the handful of farmers who used the tractor in 2025 trials, Kavalier reports. There was enough fuel for a day’s operations with existing tanks, although they are likely to add larger tanks if the project reaches commercialization.
There were questions during those first field trials about whether the ethanol would deliver the needed power and what the fuel efficiency would be in terms of cost. “What I would tell you is that when they got done at the end of the day, they were all surprised at how well the tractor performed,” Kavalier says[KM2] . The comparative fuel cost is also favorable when combining the elimination of DEF with lower-cost ethanol, despite the greater volume. “It’s potentially cheaper by as much as 15 to 40%,” he says. “We’re still working our way through understanding that.”
More field trials are on deck this year. “We use these to understand where customers are at with it. If we get the right feedback and the confidence we need, at that point we’ll start working towards advancing towards production.” If it gets a green light, Kavalier expects the commercial launch could be early in the next decade.
How much ethanol demand might this result in? John Deere hasn’t researched that, Kavalier says, adding that about 60 billion gallons of diesel are used annually in the United States, with between 3 billion and 3.5 billion gallons in the ag sector.
Considering the low turnover rate for tractors on the nation’s farms, an ethanol-powered tractor might become a great way for farmers to support ethanol, but it won’t result in a big market for a long time to come.
Powering Global Shipping
Maritime use, however, could be a much larger, near-term growth market. As Zoltan Szabo, secretary general of the Climate Ethanol Alliance, has written, if U.S. producers were to capture just 5% of the global maritime fuel market, ethanol demand could increase by roughly 4 billion to 5 billion gallons per year.
“International shipping consumes roughly 300 million tons of fuel annually, and pressure to reduce emissions is intensifying across regulatory, financial and cargo-owner channels,” writes Ankit Chandra, senior manager of global ethanol export development for the U.S. Grains and Bioproducts Council (USGBC). He outlines the opportunity in two articles on the council’s website.
Over 430 vessels in the global fleet—77 in service and more than 350 on order— are methanol-capable. “While methanol has led early deployment,” Chandra says, “ethanol offers several structural advantages.” One is production scale, which while currently at 15-16 billion gallons annually also has another 2 billion gallons nameplate capacity readily available. “Unlike several emerging maritime fuels that remain constrained by early-stage supply chains, ethanol is already produced, transported and traded at scale, with existing storage and handling infrastructure across major export terminals.”
Ethanol’s fuel characteristics align well with maritime operational requirements, he adds, and overlaps with methanol-capable designs and infrastructure requirements. On a volumetric basis, ethanol offers higher energy density than methanol, helping extend range or reduce tankage, he adds. Dual fuel optionality, he suggests, diversifies feedstock risk and broadens procurement options.
“Ultimately, shipowners will evaluate fuels based on cost, reliability and regulatory compliance,” he writes. [KM3] “The dual-fuel configurations being adopted introduce flexibility in fuel sourcing and operations.”
On the downside, the RINs generated by fuels used in marine applications must be retired, although bipartisan legislation has been introduced to include maritime use in the Renewable Fuel Standard (RFS). Maritime use isn’t explicitly named for 45Z, but the regulations around fuels used in transportation are being interpreted to include maritime. The European Union also presents a downside, with its FuelEU Maritime Regulation adopted in January 2025 prohibiting the use of crop-based biofuels. The United Nation International Maritime Organization’s Zero-Net Framework would supersede EU and other regional regulations. However, the current U.S. administration successfully delayed its implementation, with another vote coming up this fall.
Regardless of policy uncertainties, one shipowner, global mining firm Vale, is actively pursuing ethanol for use in its ships, mining operations and other logistic infrastructure. Vale is one of the world’s largest iron ore, copper and nickel producers and Brazil’s biggest logistics operator.
In April, Vale claimed to be the first to order an ocean-going vessel to be powered primarily by ethanol. The first Guaibamax vessel built by Shandong Shipping Corp. in China should be put in service in 2029.
Earlier, Vale announced plans with engine manufacturer Everllence to develop an advanced ethanol-powered engine, pointing to successful tests running ethanol on a four-stroke, dual-fuel GenSet and a 90-bore, two-stroke liquid gas injection methanol engine. Vale is also working with Caterpillar on a dual fuel solution for trucks to operate on diesel and ethanol, with the initial phase concentrating on Vale’s fleet of 240-ton haul trucks. Other projects partner with Cummins and Komatsu to modify 230–290-ton trucks as dual fuel, running on up to 70% ethanol.
Replacing Petroleum Chemistries
There may be opportunities beyond the big engines used in farming, maritime or mining. Jakel sees multiple potential industrial uses, but cautions, “it’s not a big growth area. There are some opportunities to replace some of the petrochemical-based ethanol, but from what we’ve seen, we don’t see a lot of big demand growth in that area.” [KM4]
FQT has developed clean sugar technology to produce food-grade and industrial-grade dextrose. Ethanol itself has multiple applications in the chemical industry such as acetic acid and ethyl acetate used for solvents. Jakel points out, however, that there are available pharmaceutical-grade assets idled after the pandemic demand for hand sanitizer vaporized.
Tapping into the petroleum-based plastics market could be a big new ethanol market. A National Corn Growers Association blog suggests 10% of the plastics market would add 15 billion bushels of corn demand. That would amount to roughly 5 billion gallons of ethanol demand.
Braskem, Brazil petrochemical company, entered that market more than 15 years ago, bringing a bio ethylene plant online in 2010 making the biopolymer precursor from sugarcane ethanol. In 2023, Braskem expanded the plant by 30% to 260,000 tons per year, which it reported boosted the sales volume of its trademarked I’m greenT bio-based polyethylene by 23% in 2024.
Braskem’s expansion efforts are accelerating. A project to nearly double bio ethylene production is in development in a partnership with SCG Chemicals called Braskem Siam. The front-end engineering design for a 200,000-ton-per-year bio ethylene plant in Thailand was expected to be completed in late 2025.
Braskem also has a project in development in the United States, this one using corn dextrose sourced from wet miller Primient. Sustainea, a joint venture between Braskem and Japan firm Sojitz, announced plans to invest $400 million for a plant in Lafayette, Ind., to produce mono ethylene glycol (bioMEG) used in everyday products from food containers to footwear. Primient and Sustainea announced a project in late 2025 to support regenerative farming practices on approximately 1,000 acres of farmland in the Lafayette region.
Futuristic Possibilities
Earlier, University of Arkansas researcher Jingyi Chen worked with Brookhaven National Laboratory scientists on another catalyst to generate electricity from ethanol. In a 2019 news release on that work, the researchers suggest ethanol fuel cells could be high-energy, high-density sources of electrical power, independent of the power grid. Compared to batteries, they say, ethanol fuel cells are lightweight and provide sufficient power to operate small vehicles, such as drones.
Ethanol is also fueling a pilot project in Brazil where an experimental clean hydrogen station began operations a year ago at the University of Sao Paulo fueling three campus buses powered by fuel cells. The ethanol-to-hydrogen station is a miniaturized steam reformer similar in concept to refinery-scale steam methane reformers (SMRs) that supply virtually all the world’s hydrogen used for fuel and chemical production. If the pilot is successful, the project partners, which include technology developers Hytron, Raizen, and several other entities, plan a larger facility to demonstrate its industrial potential.
Hydrogen is targeted for hard-to-decarbonize industrial processes because it produces three times the power of an equal amount of natural gas with water as the only byproduct. The downside for hydrogen is the need to develop infrastructure to handle the volatile, flammable gas. Thus, the Brazilian interest in utilizing easy-to-transport liquid ethanol as a hydrogen carrier. [KM5]
Among the potential future uses profiled here, policies favor transportation use, according to one industry insider who suggests the price parity isn’t there yet for widespread adoption by chemical companies. Braskem’s recent announcements do suggest demand for biopolymers is finally growing more than a decade after introduction.
Transportation incentives aren’t a given, either. The SAF premium in the original 45Z legislation was knocked back in the One Big Beautiful Bill to the same $1 per gallon maximum as other fuels, dampening enthusiasm for the required major capital investments to build ethanol-to-SAF facilities. And, while bills have been introduced to include maritime-bound fuels in the RFS, little is being accomplished in Congress and the EU’s disallowment of crop-based biofuels remains a barrier for a major market, unless the IMO framework gets adopted.
The latest global petroleum disruption over the Iran conflict, however, on top of heightened concerns about climate change impacts raises the question whether the movement towards replacing petroleum with ethanol and other biomass-based fuels and chemicals is about to gain momentum.