Hawai'i is experiencing the initial stage of what may be its greatest challenge: the end of cheap, abundant, easily available oil.

How we respond will determine our future and that of our children and grandchildren and people who visit our shores.

The crisis isn't temporary — or political. Recent rapid increases in the price of oil are not temporary events that will soon pass.

While the price of oil may go down a bit for a while, it will increasingly head up sharply. We are in the initial stage of a permanent transformation of energy supplies and demand, which will result in a new world — and a new Hawai'i — in the 21st century. Even the conservative International Energy Agency, the energy watchdog for the industrial world, recently warned that "the wheels might come off the oil supply" because of stagnating world oil supply in the face of strong and increasing demand.

Did this crisis catch us by surprise? Yes and no. Energy experts in the 1970s warned that peak oil would begin to affect us by the early 21st century. Early attempts were made with research and development of Ocean Thermal Energy Conversion (OTEC), solar, wind and geothermal energy — all potential sources we have in abundance in Hawai'i. And conservation remains the most important contribution to an energy solution that we can make.

But these efforts were largely abandoned or reduced in the 1980s when the price of oil fell sharply, making alternative energy sources appear to be uneconomical, even though the development of new sources was essential for our long-range future. As recently as 1999, oil analysts predicted a glut, with the danger of oil prices collapsing to $5 per barrel. As recently as 2003, some analysts in Hawai'i predicted oil "as high as" $25 by 2015.

Fast forward to 2008 and we have seen oil prices pass the $150 per barrel mark, while OPEC and others speak openly about the prospect of oil prices at $200 per barrel and beyond. While the reasons for the current high oil prices are often attributed to greedy investors and windfall profits of oil companies, the fundamental reason is the growing gap between supply and demand. This will only get worse.

There are many potential alternatives to oil. But it will likely take at least 20 or 30 years — perhaps more — from the time we decide what those alternatives are to transition from oil to other sources.

Compared with other states, Hawai'i is the most oil-dependent. Each person in Hawai'i consumes about 45 barrels, compared with about 25 in the U.S. overall. About 90 percent of all the energy consumed for electricity in Hawai'i and for ground and air transportation is petroleum based. The rest is coal and some renewable sources. On the Mainland, only 2 percent of electricity is generated by oil; in Hawai'i it is 76 percent.

Indeed, Hawai'i has recently experienced some "shocks" that might help us understand what is still to come. The price of oil per barrel in 1999 was $12. In 2005 after Katrina hit, it reached $70. Now we have seen prices exceeding $150. Oil now costs 10 times what it did only nine years ago.

Tourism is the backbone of our economy. For years, airfares to and from Hawai'i have been comparatively cheap, per mile flown, compared with many other routes in the U.S. and elsewhere. Today, no airline flying into and within Hawai'i is profitable. Airplanes rely on jet fuel distilled from oil. While alternatives are being sought, nothing comparable to jet fuel currently exists.

At what point will it become too expensive for most of us in Hawai'i to fly interisland, much less to the Mainland? When will it become too expensive for any but the richest of tourists to visit Hawai'i? Will passenger ships pick up the slack? They, too, burn oil.

Most of the food we eat is flown or shipped in by petroleum-burning carriers; it will cost more and more every year to ship food in, and between, our islands.

Most of the goods we buy in our stores are imported. At what point will the cost of importing them become prohibitive, especially if we have little income on our own, and must compete with huge markets elsewhere in the world.

Clearly, we need to prepare. Among the things we should consider: