Regenerative vapor energy recovery system and method for use with an ethanol plant. Regenerative vapors are partially condensed in a regenerative precondenser using a warm water stream. The warm water stream is fed to the regenerative precondenser and the partially condensed regenerative vapor stream is sent back to the ethanol plant where the stream is fully condensed using an existing condenser. The ethanol plant is thus operated at greater energy efficiency with lower operating costs than would be achieved with conventional systems.