Flex-fuel-diesel hybrid vehicles or more oil refineries: Which is the better investment

Originally posted on the Hybridcarblog.com

When the Iranian Revolution in 1979 caused massive gas lines in the United States, many Americans turned to small Japanese vehicles. Eventually, however, oil prices stabilized, gas prices dropped, and many Americans returned to gas-guzzling as SUVs became an expression of American freedom.

But the Iranian Revolution wasn't only felt in the U.S., and the problems of oil dependence, particularly foreign-oil dependence, pushed Brazil to do more than just buy a few small Japanese vehicles. By 1985 almost every vehicle produced in Brazil was designed for alcohol as fuel transportation and gasoline stations were updated to handle this new fuel.

So did Brazil kick the oil habit? Not exactly. According to an interesting article, Ethanol: Is it the answer?, a combination of cheap oil and droughts - which caused poor harvests and less ethanol - led Brazilians back to oil.

Today in Brazil, flex-fuel technology has changed everything. Able to run on both gasoline, ethanol, or a mixture of the two, flex fuel vehicles allow Brazilians to take advantage of which ever fuel they choose. Thus, drivers are hedged against either drought, or skyrocketing oil prices.

So should America just focus on flex-fuel vehicles as the solution to America's oil problems?

Absolutely not.

Flex-fuel vehicles definitely are part of the solution, but even Brazil hasn't been able to kick the oil habit. More important Brazil consumes SIGNIFICANTLY less fuel per year than the U.S.. Additionally, Brazil uses sugar to produce its ethanol fuel, the U.S. uses corn, which is far less efficient than sugar.

Of course new grains, etc., might offer better efficiency, but how long will it take to create enough fuel? Brazil produces only about 5 billion gallons of ethanol per year, U.S. demand is around 140 billion gallons per year. And what about drought, or another natural disaster?

The key to Brazil's struggles and successes boil down to one thing, flexibility. Flex-fuel vehicle technology should be the standard in America, but it shouldn't stop there. Hybrid technology, or even better, plug-in hybrid technology, offers even far more flexibility.

Hybrid cars, or better yet, flex-fuel hybrid cars, could significantly improve fuel efficiency, while opening up new fuel possibilities beyond oil. In reality; however, fuel competition alone won't be enough to handle the oil monster, and that's why hybrid technology is so important.

Plug-in flex-fuel advanced diesel hybrid vehicles could offer fuel efficiency of more than 100 mpg with today's technology - even for SUVs. Sure the technology is somewhat expensive today, but it is FAR less expensive than fuel cell technology. Additionally, a national fleet of 100 mpg vehicles would end the need for foreign oil in about 5 years, which I've argued could save America more than a TRILLION dollars (more).

Even better, plug-in power could lead to another revolution in the automotive world, the utilization of solar power. Already solar power is cost-effective to power a home - if you are going to live in that home for at least 15 years - but what if you could also help power your car with your home energy system, with totally clean energy? Even more interesting, garage mechanics have already created plug-in hybrids with solar panels and Mazda is now showing a solar hybrid concept vehicle that includes embedded solar panels in the roof of the vehicle.

Ultimately, the good old days of the U.S. auto industry are over. Constant innovation and the best technology are an absolute requirement, and the best technology requires fuel flexibility, as well as the best possible fuel economy. It isn't just about saving money at the fuel pump, or protecting the environment, it is about protecting the security and welfare of Americans and the American economy.

Neither ethanol, bio-diesel or hybrids alone are going to take the oil monkey off America's back quickly enough, but combined, these alternative choices could radically change America within a decade.

Instead of subsidizing the cost of a foreign-oil-dependency-ending fleet of vehicles, America is going to build more oil refineries, drill in Alaska, and give billions of tax payer dollars to filthy rich oil companies, as GM increases production on the Hummer.

Is that really an investment in the future? Isn't it time to start investing in real American freedom, instead of investing in companies that can profit as much as $23 billion in just one quarter?

I guess it is pretty clear who Congress represents, and it isn't the majority of Americans.