I've never heard anybody actually say how much ethanol costs.
That is the big "gotcha". It is currently subsidized. The actual production costs for E-85 from corn and sorghum (per unit of energy) is easily triple that of petroleum gasoline. This is a re-hash of the "gasahol" crap from the early eighties. Just another additive (like MTBE and the detergents like phosphorous). Engine technology is much better today, but E-85 is much less efficient than gasoline. I do not remember the exact percentage, but 87% comes to mind. I will google it.
The government has spent millions, and made a lot of papers and books. These were about the most objective discussions, and it is still far from settled or agreed upon. "One of the biggest critics of fuel ethanol is David Pimentel, Cornell University. He asserts that it takes about 70% more energy to grow corn and make ethanol from it than what goes into the ethanol. Among other things, however, his analysis is based on old data and does not give any credit for the energy value of the animal feed co-product of making ethanol. On August 23, 2005, the National Corn Growers Association hosted The Debate on the Net Energy Balance of Ethanol, which directly addresses and refutes Pimentel's claims."
http://www.eere.energy.gov/afdc/altfuel/eth_energy_bal.html