I am reposting my response that was near the bottom of the Khosla ethanol thread.  
Here are my thoughts again.

   1. Reduce consumption everywhere, particularly liquid fuels, via drive for efficiency of motors and conversion of fuel energy to work.
   2. Eliminate waste everywhere.  All waste will be some one elses raw material.  Stop sending everything to Land fills.  Ames Iowa has one of three Resource Recovery plants in the nation (built in the 1970's) that sorts metals, glass and others and and provides refuse derived fuel, RDF. The RDF is sent directly to the coal fired generating plant and reduces coal consumption very significantly, electric rates haven't changed for 25 years.  We need more of this approach  country wide.
   3. Mass transit should be funded massively to reduce use of cars for work commuting.  This can be electric, hybrid diesel or other and can be light rail buses or other.  The goal is lots of bodies moved per btu's consumed.
   4. Raise CAFE standards (double?) now with built in increases yearly.  Make sure these can't be reversed if things improve in the short run.
   5. Do not pick winning transportation strategy (hybrid, electric, hydrogen, NG, etc.) but allow 3) to crank up innovation.
   6. Each state must identify the correct mix of alternative low fossil fuel energy to chase.  This needs to be fostered with incentives provided nationally to holistically reduce energy consumption and start capturing renewable energy.
   7. I live in Iowa and see ethanol from corn and biodiesel from soybeans as viable for the midwest.  Good EROEI in these states where irrigation is not needed.  This technology should not be exported to all 50 states.
   8.  For the midwest it makes sense to maintain a liquid fuel supply to farm and transport agricultural commodities.  Biofuels can meet this need with waste streams feeding animals or used for industrial purposes.  
   9. The loop on biofuels can be closed in the midwest.  Percent of crop used to make fuel which is used to plant and harvest next crop with distillers grains and glycerine being used locally to make more food.  If this can be done other places with other raw material it should be pursued.  Energy must be captured and used locally, don't make ethanol from cellulose in New England and send it to Arizona for consumption.  All the efficiency is lost in transportation.
  10. The goal is for each state/region to manage their energy balance, gaining as much non fossil energy as possible from appropriate sources.  Every southern state is a natural for solar cells on every roof surface.
  11. Push solar, wind and micro-hydro at the individual consumer level.  Facilitate a distributed grid for electricity production and storage.  Lots of small generating sites rather than a few huge generating sites.  Big companies can manage the maintenance and distribution system.
  12. All of above should be set up to allow people to track their consumption and production of energy so that feed back loops get created.
  13. Once people are more responsible for having to maintain more of their balance of energy they will hunt for ways to use less and make more on their own because it has direct financial benefit to them.

I believe in the silver BB's approach to reducing reliance on fossil fuel.  Government and investment capital needs to stop trying to replace oil, NG and coal with technology X.  Isn't going to happen.  Invest instead in conservation approaches and on site energy capture.  

This needs to be a 50 year, minimum, retooling of the United States.  The Interstate highways took 50 years to build.  The new transportation and energy system will take just as long but will be self sustainable when complete.

Over the 50 years it takes to get off oil and coal world population has to be allowed to decrease through lower birth rates matched with natural die off of elderly.  If we stop having lots of children in 30-50  years 6 billion people will be die naturally at the end of their life span.  At that time a smaller population can use the energy capture system that will have been built to maintain a stable population.

That's the vision.  How do we convince moneyed and political interests to buy into that long term view at the expense of short term gain?