Thing is, it isn't ethanol, it's biodiesel.
A smart man over at the University of New Hampshire figured out that we could supply all of our fuel needs with algae based biodiesel, without using one acre of land. Instead, we would need aprox. 15000 sq. miles of water. Now I realize that seems like a *lot* of water, but really, in the greater scope of things, it isn't. Think of 15,000 sq miles as only 1/10 the size of the Sonora desert.
So where would we get all this water? Easy solution, wastewater treatment plants. Every WW plant has holding ponds where raw sewage is kept before it's run through the plant. Well, algae just loves sewage, and will help break it down. So start algae crops in these holding ponds, and you accomplish a two fold purpose. You break down sewage, and are producing a biodiesel crop.
Then all we would have to do is mandate that all vehicles are made using diesel engines within ten years, and relatively minor modifications to our infrastructure, and presto, no more oil addiction.
For reference<
http://www.unh.edu/p2/biodiesel/article_alge.html>