From "How Ethanol Is Making the Farm Belt Thirsty" in today's W$J (subscription):

Everywhere farmers grow corn, water is becoming a major concern as ethanol plants ramp up production at a startling rate and the threat of drought is ever-present. Rushing to help meet President Bush's call to cut gasoline use by 20% over the next 10 years, the ethanol industry has projects under way that would nearly double capacity from the current 6.8 billion gallons of ethanol a year.

A 50-million gallon ethanol plant might use about 150 million gallons of water to make fuel. That's more water than some small towns use, raising some local battles over placement of the plants. But farmers in [one Nebraska] district alone pumped 62.6 billion gallons of water from underground in 2005. That's why many water experts are more concerned about farmers growing more thirsty corn to meet the extra demand from ethanol than they are about the water used by the distilleries themselves.

And have I mentioned that ethanol subsidies and mandates are driving up corn prices and creating pressure to convert habitat into farmland? Promoting corn-based ethanol is not an environmentally sound energy policy. It's an anti-environmental energy policy.