Here is some info I found on Wikipedia that shows that 10% ethanol mixtures(common today) can seperate at temps higher then 70 degrees causing "water slugs" in your fuel system. In specially made engines Ethanol is more fuel efficient due to higher conmpression, but actually decreases power 34% in regular engines and gives WORSE fuel mileage in normal engines. The only reason we are getting 10% ethanol is because it cuts the cost of the gas by pennies!
Fuel economy
In theory, all fuel-driven vehicles have a fuel economy (measured as miles per US gallon, or liters per 100 km) that is directly proportional to the fuel's energy content.[27]In reality, there are many other variables that come in to play that affect the performance of a particular fuel in a particular engine. Ethanol contains approx. 34% less energy per unit volume than gasoline, and therefore in theory, burning pure ethanol in a vehicle will result in a 34% reduction in miles per US gallon, given the same fuel economy, compared to burning pure gasoline. This assumes that the octane ratings of the fuels, and thus the engine's ability to extract energy from the fuels, are the same.[14][15] For E10 (10% ethanol and 90% gasoline), the effect is small (~3%) when compared to conventional gasoline,[28] and even smaller (1-2%) when compared to oxygenated and reformulated blends.[29] However, for E85 (85% ethanol), the effect becomes significant. E85 will produce lower mileage than gasoline, and will require more frequent refueling. Actual performance may vary depending on the vehicle. The EPA-rated mileage of current USA flex-fuel vehicles[30] should be considered when making price comparisons, but it must be noted that E85 is a high performance fuel, with an octane rating of about 104, and should be compared to premium. In one estimate[31] the US retail price for E85 ethanol is 2.62 US dollar per gallon or 3.71 dollar corrected for energy equivalency compared to a gallon of gasoline priced at 3.03 dollar. Brazilian cane ethanol (100%)is priced at 3.88 dollar against 4.91 dollar for E25 (figures July 2007).
[edit] Ethanol fuel mixtures
For more details on this topic, see Common ethanol fuel mixtures.
Hydrated ethanol × gasoline type C price table for use in BrazilTo avoid engine stall due to "slugs" of water in the fuel lines interrupting fuel flow, the fuel must exist as a single phase. The fraction of water that an ethanol-gasoline fuel can contain without phase separation increases with the percentage of ethanol.[25]. This shows, for example, that E30 can have up to about 2% water. If there is more than about 71% ethanol, the remainder can be any proportion of water or gasoline and phase separation will not occur. However, the fuel mileage declines with increased water content. The increased solubility of water with higher ethanol content permits E30 and hydrated ethanol to be put in the same tank since any combination of them always results in a single phase. Somewhat less water is tolerated at lower temperatures. For E10 it is about 0.5% v/v at 70 F and decreases to about 0.23% v/v at -30 F.[26]
In many countries cars are mandated to run on mixtures of ethanol. Brazil requires cars be suitable for a 25% ethanol blend, and has required various mixtures between 22% and 25% ethanol, since of July 2007 25% is required. The United States allows up to 10% blends, and some states require this (or a smaller amount) in all gasoline sold. Other countries have adopted their own requirements. Beginning with the model year 1999, an increasing number of vehicles in the world are manufactured with engines which can run on any fuel from 0% ethanol up to 100% ethanol without modification. Many cars and light trucks (a class containing minivans, SUVs and pickup trucks) are designed to be flexible-fuel vehicles (also called dual-fuel vehicles). In older model years, their engine systems contained alcohol sensors in the fuel and/or oxygen sensors in the exhaust that provide input to the engine control computer to adjust the fuel injection to achieve stochiometric (no residual fuel or free oxygen in the exhaust) air-to-fuel ratio for any fuel mix. In newer models, the alcohol sensors have been removed, with the computer using only oxygen and airflow sensor feedback to estimate alcohol content. The engine control computer can also adjust (advance) the ignition timing to achieve a higher output without pre-ignition when it predicts that higher alcohol percentages are present in the fuel being burned. This method is backed up by advanced knock sensors - used in most high performance gasoline engines regardless of whether they're designed to use ethanol or not - that detect pre-ignition and detonation.