The great American writer Paul Theroux once said, "Travel is only glamorous in retrospect."

These days, energy costs figure in to make a vacation seem anything but glamorous or carefree, and energy-intensive tourism companies have gotten hit hard.

But with new energy efficient technologies being employed almost daily, we see a niche where smart investors can make serious money.

Profiting from Energy Efficient Travel Stocks

No one's thrilled that American Airlines (NYSE:AMR) is starting to charge for pretzels and checked luggage. But high-flying transportation companies are none too thrilled about the pocket pinch that's leading to those cuts.

AA is trying to promote its Fuel Smart program, which they say saves nearly 70 million gallons of fuel a year by turning off engines during taxiing and cutting back on heavy food carts.

It's the same squeeze that is hurting fossil-fuel freight trucks and bus systems down on the ground in the U.S., forcing cuts wherever they can be made.

And expensive oil is also choking airlines outside of the U.S.—Air New Zealand just dropped its 2008 earnings outlook to a full 25% below last year's total.

They're replacing Boeing 747 jumbo jets with more energy efficient 777s for the London-Los Angeles route, and we're sure to see the Kiwi national line make many more tehnological changes to pad its profit margins.

As in almost any industry these days, the companies that are alive in a few years will be the ones that wisely invest in efficiency now.

Flying While Fighting Fuel Drag

At the Berlin International Air Show this week, airline fuel analyst Bob Mann told the Associated Press he estimates that "at current fuel prices it would require a 20 percent increase in revenue, accompanied by a 20 percent reduction in capacity for US airlines, to generate economic returns."

You don't have to be an economist to know that's darn near impossible to achieve, especially with a recession still hanging over everyone's heads.

So we turn now to a man whose coffers are sufficiently padded...

Richard Branson, the eccentric owner of Virgin Atlantic Airways, Ltd, has long been known for his antics like dropping dollars as he floats in a balloon over crazed audiences.

These days I bet Branson's clutching his airborne bucks tight.

With oil as 30%-50% of any airline's operating cost and oil rising towards $150, Virgin hopes to make a dent at least in practical testing.

The company flew a 747 powered partially by palm oil from London to Amsterdam this February.

That was the first airliner to burn biodiesel, but there may not be much more of that anytime soon.

David Kaminsky Morrow of industry magazine Air Transport Intelligence said in Berlin that serious use of alternative fuels in air travel "is something that we'll see in the longer term. It's not a simple exercise to take kerosene out and put something like sunflower oil, or whatever, in."

No one's saying the switch will be easy... narrow-bodied designs and aeronautical advances far beyond the knowledge of your humble editor will have to be made.

And, frankly, the first stop for many manufacturers and airlines alike will be coal-to-liquids technology, which was put to large-scale aeronautical use by the German Luftwaffe in World War II as the Nazis were isolated from oil supplies.

But we've still got a biofuel play that will take off with renewable energy progress in the skies.

Brazil: Sugar in the Sky?

Long-term investors should consider Cosan (NYSE:CZZ), the top international refiner of sugar and a leader in sugarcane-based ethanol.

Cosan is headquartered in Brazil, an economy that is booming and has turned around many national businesses over the past decade. Among those is aircraft manufacturer Embraer (NYSE:ERJ), which is known for making smaller planes (you may have taken one on a short connection), and used to be known for making small change for investors.

The combination of Embraer, Cosan, and even Brazil's national oil company Petrobras (NYSE:PBR) which has huge biofuel investments, give Brazilian ADRs the trajectory they need to top your list of smart airline stocks.

Next week, we'll look at some tourism trades down on the ground that will let you capitalize on the greening of hotel chains and resorts.

Until then,

Sam Hopkins

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Electric vehicles of America huh?

If you want to see something interesting, check out the documentary called “Who Killed the Electric Car.”

http://www.redux.com/playlist/who_killed_the_electric_car_entire_full_length_documentary

WELL I DONT KNOW WHAT NEW ALTERNATIVE FAR OUT FUELS THEY COULD USE:OR MAYBE NEW WAYS TO USE FAR ADVANCED SYSTEMS THAT ARE SUPPRESSED FOR NOW :BUT HOW ABOUT THE NEW EXPERIMENTAL "BOEING ELECTRIC "TWO PLACE SMALL PLANE :MADE LARGER {A WHITE ONE THAT WAS ON A FORIEGN TV NEWS SHOW LAST WEEK !!

Sugar cane and Corn are renewable but not the fossil water it uses to produce. All major producers of fuel and Automobiles understand that Hydrogen, H2 is the ultimate fuel of the future. It can be manufactured with slack time power or even solar from waste water at are near distribution point.

As a Captain of a Boeing 757, this week I flew 180 people from Washington to LAX. We burned 26000 pounds of fuel(3800 gallons) at a cost of about $14000 total fuel bill. This equates to $78 per person for fuel. Another $1 per gallon would add another $21 per person each way on this full flight. Compare this to driving the 2600 miles alone you would have to get over 100 mpg to burn the same 21 gallons per person.
It's still an efficient albeit stressful, way of travel.

Dear Sir/Ma'am:

I heard some things sometime back about how water could be used to create fuel, like hydrogen fuel, or something,since water is 2 atoms of Hydrogen. It could be converted to fuel somehow, and I think I heard that this is already being done experimentally. What about doing that with ocean water?

Bill