>A complete report covering all of the applications of ethanol in 
>gasoline, in new and used engines: ERDC Project No 2511 Intensive 
>Field Trial of Ethanol/Petrol Blend in Vehicles. This trial showed no 
>harm to any engines, and documented the benefits. This is the 
>Executive Summary, compliments of Apace Research Ltd -- 10 pages, 
>32kb Acrobat file.
>http://journeytoforever.org/biofuel_library/EthanolApace.PDF

Addendum:

I went and looked at this after posting, as I felt remiss in not
examining it first.  It seems to make a good case for the benefits of
ethanol at a 10% anhydrous blend and does some to address the
allegations of negative effects on machinery.  It does little to
address what I said in my other post appears to be the brunt of the
allegation, which is that since some are mixing in a blend much in
excess of the much-researched 10% figure, this is causing a lot of
damage to machinery. 

To go back to what it does address, it mentions that they found, under
"materials compatability" and "engine wear" that there are no
discerniable effects, no increased engine wear, etc., of using such a
blend as against a regular petrol blend.  As it might be useful (God I
hate doing this; I hate the uncopy-pastability of .pdf format), I will
quote directly (manually transcribing, sacrificing fingers for the
cause):

Begin quote:

-----------------

"[...] The results of this project for the 1999 fleet composition show
that, when compared to use of neat petrol, use of 10% v/v
ethanol/petrol blend has the following effects:

[...]
[...]

--      Materials Compatibility:

        --      there is no discernible effect on any plastic or
elastomer materials; and,
        --      there is no discernible corrosion in fuel wetted metal
parts such as fuel tanks, lines, pressure regulators, etc.

--      Engine Wear:

        --      there is no additional or unusual wear to that
normally expected; and,
        --      there is no additional increase in wear metals or
decrease in total base number (TBN) of the lubcricating oil.

[...]

----------------
End quote

Now, there are some other passages which do give perhaps some further
insight on the issues, and I am just not willing to transcribe more.
For example, there is the issue of older vehicles being more prone to
phase separation and other water issues, as well as some health
concerns for emissions.

There is also some mention of other blends, including a hydrous blend,
and a Brazil-ish 22% blend (which sounds almost like what some
Australians are getting whether they want it or not).

But, anyway, the basic issue is left unadressed, and it just sounds
like, going back over the last couple of months, this whole thing
amounts to a good effort (introducing a goodly amount of ethanol use
nationwide for Australia) is being hurt by a campaign to introduce it
in an overly aggressive and somewhat technologically irresponsible way
which might theoretically result in enough of a black eye to provide a
very serious setback.  

If I'm wrong, then I'm sorry for spreading what you or others might
consider to be false information, but I'd like to do a better job of
figuring out the issues on this.  Australia, as I've said, is not
insignificant in its alternative energy efforts.  Although I don't
have a sense of their overall fuel and energy use, this seems to me to
be a very important project for them, to introduce such a high amount
of ethanol to such a significant country's fuel mix, (they sure must
travel a lot of passenger miles between some of their destinations!),
and I think if we take some extra time to hammer out what the issues
are for them, then those of us who are interested to do so can decide
what we think is the right course of action for them and (just by
writing our opinions) perhaps influence their projects and others.

MM

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