This has always being a long debated subject when it crops up that ethanol in fuel is bad and destroys "all" rubbers which it can do in prolonged use but only on certain motorbikes or cars.
So as from September 2010 E10 will become the standard 97-RON unleaded in the UK which I believe is replacing the E5 95-RON which means rather than having a max of 5% ethanol it will have a minimum of 5.5% and maximum of 10%
Although E5 will still be available in the form of super unleaded
Why ethanol? well its burns like petrol and will reduce CO2 emissions by 750,000 tonnes per year. While ethanol burns like petrol its higher octane that's probably why its upping 95 RON to 97 its actually less energy dense
Pure petrol's energy density is 34.2 megajoules per litre while ethanol is 24 megajoules per litre
E10 comes in at 33.18 MJ/L
Not a great difference but that means less MPG by about 1-2%
While ethanol mixes with petrol and does not separate which is good it also attracts water which is bad! if bikes or cars are laid up for a length of time the ethanol the ethanol can absorb water even from the air and the fuel can undergo a phase separation where the ethanol and water mixture separates from the petrol and sinks to the bottom of the tank which can cause rust and ethanol over time can become acidic corroding aluminium, zinc and galvanised metals.
It can also react with plastics and rubbers if left for a length of time too which some bikes have plastic fuel tanks like the 2003 - 2011 Ducati Monster, Multistrada, Sportclassic, Streetfighter, Superbiker and hypermotard which Ducati had replaced on affected bikes. This was more of an issue in the USA as they have been using 10% ethanol since 1978 and has been standard for a decade.
There is a E10 compatibility list available on the gov website