While the markets have been doing their thing, really meaningful progress is being made on, arguably, the number-one, biggest, scariest problem facing Americans and, for that matter, the entire globe: Transportation power.

The problem is really simple to understand – the US is heavily dependent on a single-sourced resource that comes in a large part via hostile partners, and we’re running out of it anyway. Oh, and by the way, when we consume the resource, the byproducts pollute our environment. Nice. Like being dependent on a drug, sold to us by a greedy dealer, and it’s killing us. We all know these facts.

I have been excited by the concept of plug-in hybrids as not A solution but THE short and mid-term solution to our country’s energy problems. Several reasons.

1) They use existing infrastructure (electric grid) rather than requiring new Hydrogen filling stations, etc.

2) We don’t take food out of the rest of the worlds mouths to power them like Ethanol

3) The technology is within reach, and adoption has already begun with the existing rise of Hybrids

If you want to go deeper into why the plug-in electric hybrid (PEHV) is the best choice, dig into the recent report from MIT.

If you’re not convinced yet, think of this: What if you could have a car that you could drive up to 40 miles a day – just like a regular car – but it NEVER burnt any gas? IF you did go, say 50 miles, a generator kicks in and uses 1/4 of a gallon to go that additional 10 miles. Effectively 50 miles on 1/4 gallon! You would have to charge up the batteries every night by plugging it into your existing garage wall outlet, but so what? Given that you’re drawing power from the grid, you’re using whatever is best and cheapest to get that electricity.(for another source of data, check SDG&E’s study results here)

We would then have a multi-redundant, multi-sourced power resource for our transportation. Coal? For now. Hydroelectric, wind and solar? Increasingly so. Nuclear? Absolutely. Whatever is most available and makes the right tradeoff of price, pollution and energy potential.

This seems like unqualified good news, right? The catch must be the timing… it’ll be 10 years, right? Wrong.

What’s great is that, while we’re worrying about the economy and the election, progress is being made:

- Earlier this month in Paris, Chevrolet debuted its Volt – the American entry to the PEHV fray. Squaring off against Toyota and the venerable Prius. If Chevy is not bluffing, it will be a superior product due to more advanced Lithium battery technology

- Just a couple of days ago, Toyota announced that they are moving forward with a tried-and-true NiMH plug-in Prius for release as soon as 2010. This will greatly reduce the technology risk, making the possibility far more real

- As these new cars hit the market they are likely to be expensive. Under a new law passed in June, there will be up to $7500 in tax credits available to PEHV drivers to defray the purchase cost

- And, in the camp of rempant entrepreneurism, there are shops like Dell’s Garage in Raleigh, NC springing up all over the place making conversion of existing vehicles a possibility for today. Today.

So, will this make a difference? Yes. Even the simplest math leans toward huge gains.

Based on an aged, yet most recent report from the 2001 National Household Travel Survey the average person travels 40.2 miles per day. Total. Another way to read that is that 50% of US consumers drive 40 miles a day or less. This is huge when you consuder that 40% of the oil consumed in the US daily is for passenger travel.

Simple math says PEHV’s could simply do away with 20% of our oil demand. Right off the top. Given that only 16% of the oil we need comes from the Persian Gulf, that sounds like a great solution…