With oil trading for less than $40 per barrel and the world immersed in a financial malaise, it is difficult to think about anything besides the most acute problems of home foreclosures, job losses, and investment losses. Nonetheless, once we traverse this period and the economy resumes its growth, the world will be faced with the single most challenging issue of our generation: the transition from utilizing fossil fuels to more clean and sustainable approaches.

The economic, geopolitical, and environmental reasons for making the transition have become apparent over the last few years. While there is general acceptance of the need to transition, many misunderstand its scope, the scale of the challenge, and the effort it will take. As I give speeches about energy and listen to speeches, with a few notable exceptions, the quantitative understanding of the scale of this endeavor is consistently underestimated.

While higher fuel prices will drive entrepreneurial zeal, the existing energy infrastructure, inertia, and scale will require additional public will and political leadership to drive a meaningful transition. These actions may include regulation, taxes, cap and trade subsidies, and other approaches that have all been discussed, especially by the incoming Obama administration. While I am not a fan of numerous regulations or aggressive taxation, for this challenge, these approaches are warranted.

My comments, within the space available, will quantitatively analyze some green approaches, which I hope encourage readers to study the issues in greater detail. While I do not have the column space to go into extensive details on each point, I would be happy to have a more in-depth discourse with those who are interested.

First, we should understand that the existing fossil fuel infrastructure has developed over several decades with trillions of dollars of investment. Consequently, except for tap water, gasoline (even at $4 per gallon) is the cheapest liquid one can buy. Natural gas, coal, and their downstream product electricity, are also relatively inexpensive. Converting all the energy used from different sources into watts (W) and extrapolating from numbers available a few years ago, the total annual energy consumption in the U.S. is roughly 4 Terawatts (1 TW = 1012 W) with 1 TW in electricity and the remaining 3 TW being burned primarily for transportation. The annual worldwide consumption is roughly 16 TW. These numbers are for the current situation. Over the next 40-50 years, the world population will increase by 50 percent. This population growth, coupled with world wide economic growth and improvements in standards of living, will increase the demand by a factor of 2 to 32 TW.