Fareed Zakaria (Newsweek)

A Cure for Oil Addicts
Energy's Future: Amory Lovins tells how we can leave the age of gas pumps profitably and painlessly.
Aug. 6, 2007 issue -

Amory B. Lovins talks big. He proposes to wean America off oil by the 2040s, touts ultralight cars and tells some of the most powerful corporate executives in the world, like those at Wal-Mart and Texas Instruments, how to behave more efficiently. But perhaps a former Oxford don—one who built a nuclear magnetic resonance spectrometer in his basement during high school, anticipated global warming in 1976 and lives in a house that can run on the same amount of energy as a conventional light bulb—is allowed to be bold. In the first of a series of conversations with thinkers and executives about the future of energy, NEWSWEEK's Fareed Zakaria spoke to the Rocky Mountain Institute's cofounder and chairman to see how this optimist makes sense of the world's energy woes. Excerpts:

ZAKARIA: President Bush says we are addicted to oil. If that is the case, is there a cure?
LOVINS: Others have noted that the term is accurate, though it obviously raises the question: when we are addicted to drugs, we're supposed to reduce the supply, so when we are addicted to oil, why are we supposed to increase the supply? There is a cure, and it is painless and profitable. In 2004, my team prepared for the Pentagon a detailed road map for getting the U.S. completely off oil by the 2040s, led by businesses for profit. Half the oil can be saved by redoubling the efficiency of using it, already doubled since 1975. The other half of the oil can be displaced by a mixture of saved natural gas and advanced biofuels. We would end up doing all the things we now do with oil at only a quarter of the cost and with uncompromised performance and improved safety.

You say it is painless and profitable, so why isn't the market doing it now?
It is actually starting to do so rather quickly, now that people realize it's possible. Let me give you an example. In 2004, Boeing launched the development of the 787 Dreamliner, which rolled out on July 8 this year and will be in the air for customers next year. It saves a fifth of the fuel of its predecessor but costs the same, and it has therefore had the fastest order takeoff of any airplane in history—it's sold out into 2014. Ford Motor Co. apparently found this persuasive because they hired the head of Boeing commercial airplanes as their new CEO. And he is now in Detroit with that knowledge and with transformational intent.

So, moving on to cars, these design efficiencies are actually more important than hybrid technology?
That's correct. It's a historical accident that hybrids came first. Three quarters of the energy it takes to move the car is caused by its weight. So there is enormous leverage in taking out weight. This was thought to be both expensive and unsafe, but with modern, very strong and light materials—light metals, ultralight steels or carbon-fiber composites—we can make weight and size independent of each other. We can make cars that are big, which is protective and comfortable, without making them heavy, which is hostile and inefficient. Therefore we can save oil and lives at the same time.

What do you think the government should do to get us off the addiction to oil?
Governments, starting at a state level, should use "feebates"—that is a combination of a fee and a rebate—to broaden the price spread of models with different efficiencies at a given size. So you go to the dealer to buy a vehicle of the size you want and there are more or less efficient models of that size, and [for] the less efficient ones [you] pay a fee. The more efficient ones [offer] a rebate paid for by the fees on the inefficient ones. Fuel taxes are a much weaker way to affect how efficient a car you buy because they are diluted, roughly seven to one, by the other costs of owning and running the car, and then they are heavily discounted. So, for a typical buyer, looking at a year or two of fuel savings is about as unimportant as whether to buy floor mats. Fuel taxes encourage you to drive less, but they're a very weak signal to buy an efficient car in the first place.

What can an average consumer do to promote energy efficiency?
When you get a car, get the most efficient one you can and drive it properly to maximize efficiency. Be thoughtful about whether the trip is necessary and how many people are in your car. Push for fairer competition between all ways to get around. Try to live nearer to where you work, shop and play.

You're an optimist.
I think we will look back in a few decades and wonder what all the oil fuss was about because, just like whale oil, we will have made this product obsolete. Oil is going to become, and has already become, uncompetitive, even at low prices, before it becomes unavailable even at high prices. So we will leave it in the ground. It's very good for holding up the ground, but it won't be worth extracting.