Supply is most important factor that drives energy economy

Vast majority of ethanol produced in IA, NE, IL, NE, MN and SD

Supply is roughly 1,500 miles away from 80% of US population who live on the coasts

Unlike petroleum, ethanol is corrosive; cannot be transported through pipelines

US consumed 4B gal of ethanol in 2006

President Bush's "20 in 10" plan would result in 35B gal by 2017

Ethanol industry will need to quadruple operations in less than a decade

But transportation system already at capacity

US transportation infrastructure must almost double capacity by 2035 to meet anticipated growth in demand

Moving ethanol can be done by train, barge or truck

Lack of truck drivers inhibiting most likely option; lack of tank cars inhibiting rail shipments

Moving ethanol by truck burns diesel creating pollution and straining transportation system

"Tank car availability appears to be the major constraint." -- Roger G. Ginder, professor of economics, Iowa State University

"There are four major tank car manufacturers--GATX, Trinity, Union and AFT. ... Some car manufacturers are booked for more than two years. Until growth in production capacity slows and/or turnaround times for ethanol tank cars increases, it will be difficult to reduce the backlog in orders." -- Ginder

6.5B gals of ethanol shipped in 2007

60% by railroad, 30% by trucks, 10% by barge in 2005