There are two main reasons why ethanol is added to gasoline. The first is to make the gasoline more high-octane, or more efficient. The other main reason is to provide enough oxygenation to reduce harmful emissions.
Ethanol is combined with gasoline because, generally speaking, it is an additive–the majority of vehicles cannot be fueled by 100% ethanol, or E100. However, since most cars on the road can run on a combination of ethanol and traditional gasoline, it is marketed as an oxygenate additive for gasoline that burns cleaner and increases mileage.
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