Promoting choice at the pump.
To outmaneuver OPEC, the market needs to be able to react dynamically. That means giving purchasers of fuel the ability to choose a different fuel at the pump if it's cheaper that day than gasoline or diesel. Brazilians already have this option: During the oil price spike in 2008, with 90% of their new cars fuel flexible, they bought more alcohol fuel than gasoline.
An Open Fuel Standard would require new cars to include a $100 tweak that would allow them to run on a variety of liquid fuels in addition to gasoline. Such fuels would include methanol, which is easily made from natural gas and biomass (and, less cleanly, from coal). Enabling vehicles to use natural gas, whether directly or via liquid fuels that are made from it, allows consumers to benefit from the very large cost advantage that natural gas holds today over oil. As we move forward, vehicles like plug-in hybrids that provide 20-40 miles of electric range before shifting to a flexible liquid fuel tank can provide a highly competitive platform. By stretching gasoline with other liquid fuels and electricity, the car can use one gallon of gasoline for every 500 miles of driving.
