Ethanol Use In The USA – Your Questions Answered

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Ethanol or ethyl alcohol is a common product in the USA but one which needs careful handing and is subject to restrictions. It is also taxable.

Ethanol is found in a range of household goods and foods, not least in spirits, beer, wines and ciders. The term is often mixed up with the term ‘alcohol’ which is much more generic. This term refers to pure ethanol or something called denatured alcohol where a co-solvent has been added to make it unpalatable. It also refers to other types of alcohol including methanol, isopropyl alcohol (IPA). Care must be taken using the term as it refers to the primary functional group too on an organic compound. The most common use of the term ‘alcohol’ is in reference to beers, wines etc. because it is undenatured alcohol and suitable for human consumption.

In The USA, ethanol content is usually quoted as a per cent ABV value or as a proof value. The proof value is double the ABV value when measured at 60 degrees Fahrenheit.

The term ‘alcohol’ can also refer to pure alcohol at any level of concentration mixed with water which also refers to its proof value. So, pure alcohol is the correct term for 100% Ethanol (200 proof), 95% Ethanol (190 proof) and any concentration of Ethanol (Vodka for example is 40% pure ethanol or 80 proof).

Denatured Alcohol

Denatured alcohol is ethanol which is made unsuitable for consumption by addition of other usually toxic solvents to make it unpalatable. The term also applied to this type of alcohol regardless of proof. There are hundreds of different formulas of denatured alcohol or ethanol.

Natural And Synthetic Alcohol

Natural alcohol is referred to as ‘fermentation grade’ alcohol in the USA. In North America generally, it is also often called ‘Grain Alcohol’ or ‘Grain-Neutral -Spirits’ (GNS). All commercially produced alcohol is fermented from grains, mainly corn but also rye and wheat. In other parts of the world, natural ethanol is fermented from a variety of carbohydrates such as cane, sugar beet, apple and grape.

Synthetic alcohol is produced from the catalytic hydration of ethylene which is generated from crude oil, gas and coal.

Tax Bodies

In the USA, tax is regulated and collected by the Alcohol & Tobacco Tax and Trade Bureau (TTB). The use of alcohol, the types of approval, the regulations relating to food, drugs, and cosmetics is managed by the FDA (Food & Drug Administration).


A manufacturer using pure alcohol (pure ethanol or ethyl alcohol ), whether for industrial or food use  must have a valid permit. It is possible to have a tax-exempt user permit which is issued by the TTB otherwise a tax called the US Federal excise tax must be paid on this.

At the current moment, the Federal Excise Tax (FET) is $13.50 per proof gallon. So 1 gallon of 200 proof ethanol contains two proof gallons with an FET of 2 x $13.50 or $27.00.

It is possible to ship small amounts of alcohol to customer without needing a permit but it must be specially denatured alcohol (SDA) or specially denatured spirits (SDS). The limit is up to 5 gallons and can only be supplied in one calendar year. It can be sold but there are no guaranteed “rights” of the customer under Federal Law.

Other solvents can be purchased in unlimited quantities without a TTB permit if those chemicals are not regulated by any other Federal Agencies such as the EPA or the DEA.


When you deal with alcohol (ethanol), whether it is pure or denatured or otherwise, a proof value must be given. The proof is a measure of the water content of the Ethanol portion of the product. Any level of proof can be manufactured based upon the amount of water added to the pure ethanol. When adding water to ethanol the resulting product is referred to as the “dilution” or “cut” of water. Therefore, the proof is a measure of the Ethanol content of pure Alcohol and is calculated as two times (2x) the actual Ethanol concentration (assay) by volume.

In the USA the three most commonly used “proofs” are:

* 190 Proof (listed in the USP monograph)

* 200 Proof (listed in the ACS and USP monographs)

* 192 Proof (Used in North America in beverage applications but also listed in the EP monograph)

Every Ethanol product should be referred to and requested in terms of its proof. A common misunderstanding is the reference to a “proof” of a denatured ethanol product. For all denatured formulas, the “proof” refers only to the ethanol used to start building the formula and not the final product. Once co-solvents are added the proof of the finished product is altered (lowered) but the original proof is maintained in the description of the final product (for example, SDA 3C, 190 proof no longer is 5% water after being denatured but is still referred to as “190 proof”.)

Denatured Ethanol occurs when a co-solvent is added to pure alcohol to render it unsuitable for consumption.

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