E85 (85% ethanol, 15% gasoline) is considered an alternative fuel under the Energy Policy Act of 1992 (EPAct). It is used to fuel E85-capable flexible fuel vehicles (FFVs), which are available in a variety of models from U.S. and foreign automakers.
The 15% gasoline content in E85 enables FFVs to operate normally under cold conditions; fueling a vehicle with pure ethanol (E100) creates problems during cold-weather operation. Ethanol can also be mixed with gasoline in lower-level blends, which provide many benefits but are not considered EPAct alternative fuels.
Other than lower gas mileage, motorists will see little difference when using E85 versus gasoline. E85 has about 27% less energy per gallon than gasoline. However, E85 is typically priced lower than gasoline, so that cost per mile is comparable.