Winning the Oil Endgame: Innovation for Profits, Jobs and Security, released by the Rocky Mountain Institute and co-funded by the Pentagon, outlines how American industry can displace oil more cheaply than buying it through mobilising modern technologies and smart business strategies.

It claims that the US could save half its oil usage through efficiency, then substitute competitive biofuels and saved natural gas for the rest, without the need for extra taxation or new federal regulation.

“Unlike previous proposals to force oil savings through government policy, our proposed transition beyond oil is led by business for profit,” said RMI CEO Amory Lovins. “Our recommendations are market-based, innovation driven without mandates, and designed to support, not distort, business logic. They’re self-financing and would cause the federal deficit to go down, not up.”

The report claims that by 2015 the US can save more oil than it gets from the Persian Gulf; that by 2025 it could use less oil than in 1970; by 2040 import no oil; and by 2050 use no oil at all.

It focuses on cars and light trucks (SUVs, pickups, and vans) which account for nearly half of projected 2025 oil use, and demonstrates that using ultralight, ultrastrong materials like carbon-fibre can halve vehicles weight, increase safety, and boost efficiency to about 85 miles per gallon for a midsize car or 66 mpg for a midsize SUV.

“Because saving and substituting oil costs less than buying it, our study finds savings of US$70 billion a year. That acts like a giant tax cut for the nation. BMW has confirmed that carbon-fibre autobodies weigh only half as much as steel and have exceptional crash performance,” said Lovins. “The resulting fuel savings can be like buying gasoline for 56 cents per gallon.

The study goes on to say that, by 2015, more efficient vehicles, buildings and factories will turn oil companies into broad-based energy companies that embrace biofuels as a new product line. It claims that cellulosic biofuels could replace one-fifth of current oil use, more than triple farm income and create 750,000 agricultural jobs.

Other policy recommendations in the report include revenue-neutral rebates for buyers of efficient cars, paid for by fees on inefficient ones; temporary federal loan guarantees for airlines buying very efficient new airplanes; and R&D investment incentives for US automakers to retrain and retool faster.

“For the first time, our report adds up the ways to provide all the services now obtained from oil, but without using oil – which will save us US$70 billion a year,” concluded Lovins. “Forging the tools to get our nation off oil forever is the key to revitalising industry and farming.”

By David Hopkins

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