You may have noticed some major oil firms are spending big bucks on green commercials. They concede that “easy oil” won’t be around much longer. Others try to portray the company as more conscientious and environmentally friendly than the consumer would expect.

Every one of these spots ends with the same theme: Oil companies are throwing money at wind, solar and even geothermal energy solutions. Of course, it’s not exactly in Big Oil’s interest to move away from its bread and butter. The harsh reality of higher oil prices is driving consumers toward alternative energies.

Even the auto industry is coming around. Bill Reinert, one of the designers of the successful Toyota Prius hybrid, was speaking to a Seattle Times reporter recently while taking a helicopter ride over an Alberta oil sands plant.

“This is what the end of the age of oil means,” he said. “The car-based culture, the business as usual of building cars and trucks, is going to change dramatically.”

Old Habits Die Hard

Cars have changed a lot since the late 1970s. Vehicles are bigger, stronger and much sleeker than your 1980 Dodge Colt. But one thing that hasn’t changed much is fuel-efficiency. In some categories, it’s actually gotten worse.

Believe it or not, a 1981 Honda Civic would give you almost 45 miles per gallon on the highway and 32 mpg in the city. That easily beats the newer, bigger Civics that are on the road today.

Even the hybrids are catching flak for poor fuel economy. The Prius’ official EPA mileage is 60 in the city, 51 on the highway. But some owners have disputed this claim. They have reported mpg performance in the mid-40s. Maybe they should have saved $18,000 and bought that old Civic back…

However, mediocre performance from these “first generation” hybrids won’t kill this vehicle breed. Hybrids will only get better as technology improves.

The New Old-Fashioned Fuel

The good ol’ government is billing ethanol as the one solution to our energy crisis. We could write for hours why ethanol is a poor alternative to gasoline. It takes too much energy to make, hogs all of our corn and farmland and is difficult to transport. The only reward is that we don’t have to go to the Middle East to get it. But there is another alternative that could actually work…diesel.

Consider this: Diesel is superior to conventional gasoline because the fuel releases less carbon dioxide than regular gasoline and diesel engines get 30% more miles per gallon.

Sure, the older, louder diesel engines coughed massive amounts of nitrous oxide into the atmosphere. But the technology is better now. Diesel engines are cleaner, quieter and more efficient. Just ask someone who lives in Europe…

About half of the cars on the road in Europe are powered by diesel engines. The diesel revolution in Europe began almost a decade ago, thanks to high fuel taxes put in place to help fight global warming.

While the U.S. hasn’t had the love affair with diesel Europe can claim, diesel and diesel hybrid vehicles are poised to gain traction here in the States as petroleum prices continue to rise.

Diesel has a strategic advantage that petroleum just can’t match: It can be made without drilling a single hole into the ground in search of crude. In fact, biodiesel can be made out of animal fats, soybean oil and even waste food oils.

There are a lot of great ideas that will come out of this. Keep your eyes peeled…

Best,

Greg Guenthner
February 28, 2008

P.S.: In fact, one already has come up… Traditional biofuels are made through complex chemical reactions between these naturally found oils, resulting in numerous byproducts. But one cutting-edge company has a better way to pump out the biofuel.

The Diesel Answer to the Oil Problem was originally featured in the Penny Sleuth.