and construction; the economic environment; and government policies. Given the wide variation in most commodity prices, especially oil prices, investors will have to have confidence that such policies as carbon caps, a carbon price, and tariffs on imported oil will ensure that alternative liquid transportation fuels can compete with fuels derived from crude oil. The price of carbon emissions or the existence of fuel standards that require specified reductions in greenhouse gas life-cycle emission will affect the economic choices.

Technologies for producing transportation fuels from natural gas are ready for deployment by 2020. Compressed natural gas already fuels vehicles. Other liquid fuels can be produced from syngas, including gas-to-liquid diesel, dimethyl ether, and methanol. Only if large supplies of natural gas are available—for example, from natural-gas hydrates—will the United States be likely to use natural gas as the feedstock for transportation-fuel production.

Hydrogen has the potential to reduce U.S. CO₂ emissions and oil use, as discussed in two recent National Research Council reports, Transitions to Alternative Transportation Technologies—A Focus on Hydrogen (NRC, 2008) and The Hydrogen Economy: Opportunities, Costs, Barriers, and R&D Needs (NRC, 2004). Hydrogen fuel-cell vehicles can yield large and sustained reductions in U.S. oil consumption and greenhouse gas emissions, but several decades will be needed to realize these potential long-term benefits.

NRC (National Research Council). 2002. Evolutionary and Revolutionary Technologies for Mining. Washington, D.C.: National Academy Press.

NRC. 2004. The Hydrogen Economy: Opportunities, Costs, Barriers, and R&D Needs. Washington, D.C.: The National Academies Press.

NRC. 2007. Coal: Research and Development to Support National Energy Policy. Washington, D.C.: The National Academies Press.

NRC. 2008. Transitions to Alternative Transportation Technologies—A Focus on Hydrogen. Washington: D.C.: The National Academies Press.