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Ethanol is added to gasoline as an oxygenate to reduce emissions not to increase octane. Ethanol replaced MTBE as the oxygenate of choice due to MTBEs ability to have a small amount of MTBE contaminate a very large amount of drinking water.
Octane as previously mentioned is actually added to make the gas/air mixture harder to ignite so. It does not increase the caloric content of gasoline, it actually decreases it. Octane is control not power. Power comes from a properly timed and near stochiometric combustion process and that requires control to achieve.
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2001 Boxster S 3.6L, Zeintop
"Calling upon my years of experience, I froze at the controls." - Stirling Moss
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