Here are a few cool articles about recent advances in developing alternative fuel sources.
Cheaper Veggie Diesel May Change the Way We Drive
Breakthrough in Biodielsel Production by Japanese Scientists
Teeny Reactor Pumps Out Biodiesel
This last article makes me wonder if there could be a way to "refine" your own fuel in the car itself. Just distribute veggie oil and alcohol and let the entire refining process happen in the car. Oil refineries would become obsolete (or nearly so) and it would seem that the cost would have to be minimal.