With prices at the pump reaching $5.00 in some areas and passing $4.00 across the nation, negative headlines abound about the negative impact on the economy. Raw material and shipping costs are growing, while consumers tighten their belts as they feel their real incomes dropping after factoring in higher transportation costs. The general view may be that tough times are here and are only getting more challenging.

Savvy entrepreneurs, though, are seeing past the immediate economic obstacles presented by the underlying rise in oil prices. Some are finding business opportunities, large and small, in the new economic landscape.

In San Diego County, one entrepreneur, Kim Adelman, has started Plug-In Conversions Corporation to convert standard Prius and other hybrid cars so that they can be plugged-in at home at night, increasing the mileage per gallon to the 100+ MPG range.

By installing a large battery pack, which is charged in the car below the rear deck, the vehicle can be driven up to 25 miles without the engine turning on at speeds below 35 miles per hour, according the company. The charger plugs into a standard 110volt outlet and fully charges up in about 5 hours. At higher speeds the additional battery pack blends with the gasoline to produce much higher mileage than an unmodified vehicle. Vehicle owners can plug in at the time of cheapest power, while they sleep.

Adelman’s company has taken the opportunity beyond pure business purposes and has made its mission to help restore and protect the planet by converting as many vehicles as possible. That has a lot of people in the community excited.

“A person has a choice to wait in line at a gas station to, in my opinion, get ripped off,” said Carlsbad, California resident Don Christiansen, “or go home and plug in to your garage and recharge at a gasoline equivalency of less than one dollar per gallon.”

Christiansen, active in the renewable energy movement since 1985, sees the issue going beyond saving dollars at the pump. When a person chooses to plug-in instead of visit the pump, he or she “supports the domestic energy industry whether that electricity comes from solar, wind, natural gas, or even coal. We end up supporting our own domestic energy industry as opposed to subsidizing OPEC and other oil producing countries and multinational corporations that make excessive profits by acting as middle men to get that finite, carbon dioxide producing fuel to our vehicles.”

Adelman’s company may be at the front of a long line of businesses seeking to help the environment while giving consumers a viable option to conserve energy and create less carbon output. Hybrid sales continue to rise, so demand for conversions might grow in step. There may be conversion shops opening up in cities across the US.

In addition to converting existing vehicles, other companies are introducing highly innovative all-electric or highly fuel efficient vehicles.

Norwegian car manufacturer THINK recently announced that its Think City Car will be introduced to the US market. These tiny plug in cars are designed to travel about 112 miles on a single charge.

Domestically, GM is introducing the Chevy Volt, which it positions as different from any previous electric vehicle in that it will use a lithium-ion battery with a variety of on-board power sources including gas and in some vehicles ethanol. The vehicle will be designed to plug into a standard 110 V household plug. Chevy touts the vehicle as allowing drivers to avoid gas altogether if they drive less than 40 miles a day.

The magnitude of the Chevy Volt project has been immense. According to Chevrolet’s website, the Chevy Volt has required “significant” resources, involving over 650 engineers and designers.

Some companies that are significantly smaller are also making big headlines. Carlsbad, California based Aptera Motors, recently announced that it is ready to take reservations for its Aptera Typ-1, available in all-electric and hybrid versions, getting 120 miles on a charge or 120 miles or more on a gallon of fuel. Charging would be 2 to 4 hours, costing around $1 to $2 using typical electricity rates for the state of California (the only state where it is available at this time). Production is expected in late 2008, with prices in the $26,900 to $29,900 range. Aptera’s founding sounds like the archetypical entrepreneurial growth story. Steve Fambro founded the company in 2006 after leaving the biotech firm Illumina. He started working out of his garage and taught himself composites. He has since grown the company to 15 employees and raised two rounds of funding from outside investors.

Service and distribution opportunities are bound to open up around these and other new vehicle technologies. Other opportunities may arise to supply or improve-upon the key components comprising hybrid or all-electric vehicles. For example, lithium ion batteries are a critical part of plug in hybrid cars and all electric cars.

Six year old, Watertown, Massachusetts based A123 is a company that makes high-power lithium-ion batteries for applications like GM’s planned Volt electric vehicles and Black & Decker power tools. The company has now raised over $130 million in funding, made three acquisitions, and opened a series of plants in China. “On top of all that,” Bart Riley, one of the company’s three founders, recently was quoted as saying, “you get to save the world.”

Potentially world-shaping products, like the Think City Car, Chevy Volt or A123 lithium-ion battery, may have reverberations that create innumerable opportunities for local entrepreneurs. Small businesses may not have the financial power to assemble a team of 650 engineers and designers, but many will be able to take advantage of numerous “Green Jobs” and “Green Opportunities” that could be in-store in the coming years.

For example, a multitude of local solar power installation companies or

contractors may be in demand by homeowners hoping to cut energy costs. Currently, the appeal of solar power is hindered by the relatively long time frame for a financial pay-off.

“Even with the California Solar Initiative Rebate and the Federal Investment Tax Credits, the energy savings on a typical residential home from solar electric would mean that the cost of your investment would pay back in about ten years and the life expectancy of the equipment is about twenty five years, so in long term that’s pretty good, and you’re doing something good for the environment,” said Christiansen. But with the coming release of plug in vehicles like the Chevy Volt or the Think City Car, the appeal of solar electric power may dramatically increase. “When those cars start coming in and little light bulbs start going off in people’s heads, they’ll start realizing ‘Hey, I can not only power my home with solar electric but I can also use that as fuel for my electric or plug in hybrid vehicles,’ and all the sudden that payback improves significantly. The thought is that the payback comes down to under five years. So all of the sudden solar electric becomes a lot more affordable to most people.”

With greater affordability of solar power contrasting against higher costs of traditional energy sources, demand for solar power, Christiansen believes, would dramatically increase. That increase in demand could spell big opportunity for the small businesses that effectively capitalize on the opportunity to install and service solar power equipment.

Big opportunities are not just limited to future events. Innovative entrepreneurs may find lucrative niche businesses within the confines of “plain-old” technologies. For example, with the spike in fuel costs, employees accustomed to commuting long distances are suddenly finding that the effective take home pay from current wages are dropping. To retain these employees, many employers are seeking solutions that can help offset the increasing cost of the commute. Companies specializing in custom-designed ride sharing programs are emerging across the country.

Opportunities are not just limited to companies operating physical vehicles. eRideShare.com operates a service that helps connect commuters and other travelers going the same way to share a ride. Founded in 1999, the site now has some sixteen thousand carpool listings. According to the company, web traffic and new listings on eRideShare.com have risen sharply since February, averaging more than 1600 unique visitors per day in the last 10 days of April, an increase of about 130%.

“The price at the pump is inflicting considerable pain on commuters,” said eRideShare.com Executive Director Steven Schoeffler. “They also realize that vehicle exhaust contributes, via global warming, to extinctions, drought, and rising oceans, and that their oil dollars are going directly or indirectly to countries that we are in conflict with. It adds up to a compelling argument for carpooling, and people are responding.”

Some are offering services that allow users to share the car, instead of sharing the ride. Zipcar, based in Cambridge, Massachusetts, offers a “new model” for automobile transportation, operating what it considers to be the “world’s largest car sharing” company. Its “Zipcars” are shared by members who reserve them by the hour or by the day. Members walk to a nearby car, hold their “Zipcard” to the windshield to unlock the door and drive away. Gas and insurance are included as part of membership. Zipcar says that its members report an average $5,000 in annual savings through using the program, while effectively taking carbon-emitting vehicles off the road at a rate of 15 vehicles per Zipcar in the Zipcar fleet, and thus offering some potential relief to problems of urban parking, congestion, and other transportation issues. Zipcars are available in more than 50 cities throughout North America and the UK. Vehicles in the fleet include not only hybrids but also standard sedans, pickups and even luxury vehicles.

The company started when its two founders were sitting in a café on vacation in Berlin and realized that a membership-based car-sharing program they witnessed there could work at home in the States. By June of 2000, they had the first Zipcars on the road. Now, some 200,000 consumer and business members have joined to share 5,000 vehicles since Zipcar’s inception.

Opportunities may also emerge for the development of consultancies specializing in providing expert guidance for companies dealing with the challenges of higher energy costs. Dadla Ponizil, of Encinitas, California, developed a home performance contracting and consulting service, Ponizil Energy, that performs an in-depth energy audit on houses to develop an upgrade strategy to improve energy efficiency and reduce total energy costs for the homeowner. His company specializes in the fast-growing field of “green building,” or using the latest home building technologies, techniques and products to realize up to 50% lower energy costs.

“Energy is going to be the 21st Century Issue,” Ponizil said. “We’re just on the tip of the iceberg on the residential side because energy prices aren’t high enough yet to have made people change the way they are building houses. But with commercial, for the past five years already you haven’t been able to build a building without consulting with an energy expert.”

Ponizil predicts that green consulting jobs will become “huge” as the cost of heating and cooling the typical residence reach critical tipping points.

Widespread opportunities will emerge for what Ponizil calls “Green Collar” jobs.

“It’s not just high-level, consulting type of expertise that will be needed,” Ponizil said. “To design and build a building to be energy efficient, you need suppliers of green materials, green roofers, green HVAC contractors, green plumbers, and on and on. I tell contractors today, ‘You better learn about the green way of doing things now’ because in five years’ time they’ll be out of a job if they’re not green because more and more communities, governmental agencies and private builders will mandate energy efficiency levels that are significantly more stringent than we have currently.”

Cross country refrigerated shipping companies are used to dealing with huge fuel costs. But when prices rise quickly, they often face a lag time between the price increase they absorb and the rate increases they can pass on to their customers. “We have been trying to do all the fuel saving options that are available such as reducing speed, adding APU’s and getting rid of the dual tires and going to a single based tire,” said one trucking industry owner. “All of these things help but it is almost impossible to keep up with the spiking of fuel cost on a weekly basis. Hopefully it will stabilize soon.”

Some trucking companies that had previously been doing very well are now facing bankruptcy protection. For example, IdleAire Technologies Corp., which specializes in services to long-haul truckers at truck stops, filed for bankruptcy in May in U.S. Bankruptcy Court. As recently as January 2006, it had announced receiving funding for an extensive expansion program. Opportunities should arise for specialists to consult with trucking and other transportation companies to devise and implement these and other fuel-saving techniques. Client trucking companies benefit from best practices developed by others for immediate, time-sensitive challenges.

While consulting specialists may help transportation companies navigate the financial challenges caused by fuel cost spikes, other local businesses are tapping into the popularity of fresh, organic food to avoid the need for refrigerated cross-country trucking of some foodstuffs altogether.

“There’s a growing movement called ‘Locavores,’ referring to those of us that prefer to purchase food that has been produced locally,” said Christiensen. “Like omnivore, herbivore, locavore. If we go out of our way to support our local agriculture we’re doing all sorts of good things besides helping the local economy. We’re also reducing carbon emissions and the costs of getting food to us and it’s typically of better quality and fresher.”

For entrepreneurs, the “locavores” present an opportunity to match local produce to consumers within a 100 mile range. Small farmers markets are springing up in urban areas, providing niche opportunities for a range of local producers. In many jurisdictions, county certification is available or required to participate as a local producer. In San Diego County, for example, the County Department of Agriculture issues a certification as a prerequisite to sell agricultural products at a farmers market that assures the public that the seller produces the products being sold. “Natural food stores” such as Henry’s Farmers Market and Whole Foods Market similarly may be tapping into a trend in purchasing locally grown produce in a smaller “neighborhood” style format as opposed to giant supermarket chains. More opportunities may exist to offer locally produced foods.

Perhaps an indication of the potential for successful business endeavors in providing solutions to the challenge of high energy prices is the degree of emotion the subject arouses in those who watch energy issues and average consumers alike. Christiansen, for one, compares the current set of energy challenges to earlier moments of national challenge and success.

“With the Apollo Project, President Kennedy rallied the nation to get a man on the moon in ten years,” Christiansen said. “And he was successful in doing that. Our country got behind it and we had a man on the moon within 8 years.” To Christiansen and others, the current oil price spike is a challenge that can be overcome. “Our country can do a similar thing with transitioning into renewable energy.” | BOJ