I don't know why it should be either/or. I'm not sure that there's any one thing we can do with our energy sector that solves all our problems.
Which raises the question, what are our energy problems to be solved?
I guess my own view is that we should have three national energy goals:
1. Produce as much energy domestically as possible, minimize the import of energy products, especially oil;
2. Assure a plentiful supply of energy in relationship to our energy needs (which means that if we do something that reduces our need for oil by a million barrels a day, that's not far off from producing an additional million barrels a day);
3. Within the context of the first two goals, produce energy (safely) as cheaply as possible.
The reasons for the first goal are two-fold. First, to my mind, it seems to have become a national security issue. Reliance on Russian mobsters, Muslim jihadists, Venezuelan dictators, Nigerian scam artists, or even Mexican oligarchs for our energy. I believe that we are limited in our foreign policy, including how hard we can fight the war on the jihadists, because of our dependence on these turds. We would be more secure if we produced nearly all our own energy, and what we imported came from normal countries like Canada, the UK, etc. As well, if we didn't import oil from these places, they would be less important and wouldn't require strategic protection, they'd be far less wealthy, and wouldn't have the same ability to finance things against our national self-interest.
Second, a large part of our trade deficit comes from paying $70 or $80 per barrel to all these putzes. It works out to over 2.5% of GDP.
As you know, I'd be more than happy to impose a tariff on imported energy (possibly excepting energy from places like Canada), and use the money collected in tariffs to reduce income taxes, or payroll taxes, or what-have-you. Just high enough to seriously advantage domestic producers of energy (especially stuff that can run our vehicle fleet).
As to the second goal, certainly, starting a long-term push toward diesel passenger vehicles is one way to accomplish it, as is drilling here, drilling now. Everywhere in the US. Shale oil, ANWR, get into all that natural gas that's being discovered practically everywhere (you once pointed out that we have literally tens of millions of potential “stations” for CNG fueling - all the homes that use natural gas for heating).
So, I'm all for producing lots and lots of stuff - DOMESTICALLY - but I'm not opposed to reasonably straightforward (if not exactly cheap or fast) things that help us to use our energy more efficiently.
sitetest
It is a limitation of capital. I suspect from my experiences, more energy production would result from investing in the oil shale.
If I was building new, I would recommend more infrastructure based upon diesel. But the incremental gain versus cost of tearing out gasoline producing units for diesel, combined with the automotive infrastructure, should make the conversion to more diesel a slow process.