Time : "How to Kick the Oil Habit"

If anyone harbored any doubts that hybrid cars are hot, the 2005 Tokyo Motor Show put them to rest. Carmakers practically ran over one another promoting their attempts to catch up with Honda and Toyota, the technology's pioneers. As the price of crude has headed steadily upward, technological innovation has driven down the cost of alternative energy sources. Oil companies, worried that these changes could leave them behind, are starting to think of themselves instead as broad-based energy companies. If this explosion of innovation has a problem, however, it may be that the developments are coming too late to allow a smooth transition to the postpetroleum era.

As consumers, we need time to make adjustments - often very expensive ones - to the new technologies. Not everyone can afford to junk a two-year-old SUV to buy a new hybrid. Most people can't afford to abandon houses built in developments 100 miles out in the countryside when oil was cheap. And although energy and power companies are investing in new technologies, they can't create a massive new infrastructure overnight.

Another problem is refinery capacity. Even an unlimited supply of crude is useless if it can't be refined into gasoline, heating oil and other fuels. Beyond that, the supply of crude is not unlimited. The more oil that is removed, the more expensive the cost of extracting the remaining oil becomes. At some point - possibly as early as 2010 - production will therefore reach a peak, and then gradually start to decline. "The problem," says investment banker Matt Simmons, "is that the global economy and the U.S. economy are structured on the assumption that the oil supply will only increase."

The one thing that will probably cushion the blow of this new and permanent energy crisis is conservation. There's nothing particularly sexy or chic about consolidating shopping trips, carpooling, turning the thermostat down in winter and up in summer, or biking to the office and back, but it does work. In the early '80s, in the midst of soaring oil prices, we doubled the average efficiency of cars, furnaces and insulation.

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