Currently, 98 percent of the U.S. transport sector runs on petroleum. 

The reasons for this dominance are simple. Transportation fuels derived from petroleum pack a lot of energy in a small volume and weight. And until recently, petroleum has been a bargain, at least in the United States. 

There has been strong focus in recent years in finding alternatives to oil, ranging from using biofuels like ethanol, or converting coal-to-oil and even experimenting with shale oil. 

Ethanol can be produced from corn, sugar, and fibrous plants, such as switchgrass. 

A government subsidy of 51 cents per gallon already makes corn-based ethanol price competitive in the United States with gasoline in the neighborhood of $3.00 per gallon. 

Outside the United States, ethanol has been made for many years from sugar; in Brazil, for example, ethanol from sugar accounts for about 20 percent of the transport fuel market. 

Indeed, the World Bank believes Brazil can make ethanol from sugar for about $1 per gallon. 

However, crops must be cultivated and then processed to produce the fuels. Cultivation and processing involve the use of energy and other inputs, such as fertilizer, that can have negative effects on greenhouse gas emissions and other environmental impacts, like water pollution.

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