The global market for Ethanol is projected to reach US$105. 2 billion by 2025, driven by sustained increase in demand from biofuel and food & beverage industries. Growing consumer awareness about eco-friendly products and supportive government policies are also driving growth. Ethanol use in industries such as automotive, chemicals, food & beverages, personal care & cosmetics, and pharmaceuticals is continuing to grow. The focus on technology advancements and development of low cost feedstock is also favoring growth. Regulatory frameworks and policies are also in place in several countries for guiding and promoting the usage of biofuels in regional transportation sectors. Skyrocketing crude prices and increasing concern of greenhouse gases are expected to boost the demand for ethanol both in the developed and developing countries over the next several years. Additionally, a ban on MTBE in several countries including the US is another boon for the ethanol market. A major factor fueling growth in ethanol market is the rising prominence of ethanol as a fuel or fuel additive in the automotive industry. The rising consumption of ethanol as a fuel is being spurred by economic, political, and social factors. The growing efforts of governments around the world to cut down reliance and slash costs associated with fossil fuel, the increased focus on reducing greenhouse gas emissions, and enhanced emphasis on developing new economies involving the use of indigenous resources is giving impetus to the fuel ethanol market. Growing concerns over the environmental damage caused by fossil fuel usage is driving demand for alternative bio-based fuels, thus driving growth in ethanol market. The adoption of regulations to promote ethanol use is also leading to high demand for ethanol as biofuel. The use of ethanol as a fuel additive to conventional fossil fuels is also presenting significant growth opportunity for ethanol market. The growing trend towards blending ethanol with gasoline is aiding market growth. With the auto industry looking for ways to reduce environmental impact, the demand for ethanol as fuel and fuel additive is expected to continuing gaining traction in the years ahead. The eco-friendly and renewable nature of ethanol and the lower emissions associated with the fuel are contributing to the growing importance of ethanol fuel. Compared to gasoline, ethanol benefits from a higher octane number, which imparts premium blending properties. As a result, low octane gasoline is combined with a 10% ethanol to achieve the 87 octane standard. Ethanol fuel offers advantages due to the low carbon monoxide products compared to gasoline-powered engines. The addition of ethanol to fuel is also being propelled by its ability to burn much cleaner than pure gas, thus facilitating in reducing carbon footprint. In California, for instance ethanol has replaced MTBE (methyl tertiary butyl ether) as an additive to gasoline. Potential changes in legislation related to the use of diesel fuel can spur demand for gasoline and hence ethanol. In Europe, meanwhile, the changing rules related to taxation of fuels to take into consideration CO2 emissions and energy content can prove advantageous for the gasoline market, thus spurring growth in ethanol demand. With the use of ethanol as a fuel additive continuing to grow in gasoline engines, the rise in automobile production will encourage growth in the market.
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