How a billionaire fills gas tank for $1 a gallon

Long Beach, California (CNN) -- Gasoline at $4 a gallon is no worry for T. Boone Pickens, the billionaire energy investor from Texas. He drives from his home to his office in a car that runs on fuel costing less than $1 a gallon.

His method: He has a device that fuels his Honda Civic GX with natural gas from the pipes that serve his home. And he thinks there's a lesson there for America's energy woes.

Pickens, who is speaking Wednesday at the TED2012 Conference in Long Beach, California, said America needs to make natural gas a building block of a plan for ending oil imports from the Organization of Petroleum Exporting Countries.

Natural gas is "cheaper, it's cleaner, it's abundant and it's ours, and we're fools not to use it," Pickens said in an interview with CNN.

Pickens, an 83-year-old trained geologist who has been working in the energy field since 1951, said the United States could use domestic resources to replace the 5 million barrels of oil imported daily from OPEC, which makes up a quarter of America's daily use of oil. The U.S. natural gas reserves amount to the equivalent of three times the oil reserves possessed by Saudi Arabia, he said.

"All you need now is leadership," he said, lamenting that America "has no plan, we've gone 40 years with no energy plan. We're the largest user of oil in the world."

Pickens' plan is encapsulated in the Natural Gas Act, a bill with Democratic and Republican sponsors, that would provide tax credits to replace diesel-fuel burning truck engines with natural gas-powered engines; users of natural gas as a transportation fuel would pay fees that would make up for the lost government revenue.

His firm, BP Capital, has a vested interest in energy policy since it invests in energy futures and the shares of firms in a variety of parts of the industry.

He said the worry over increasing fuel prices in the United States rests in part on a lack of understanding of the energy market. Energy prices in America are by far the cheapest in the world, with Europeans paying more than double to fuel their cars and with natural gas costing four or five times as much in Europe and China.

Promises of much lower fuel prices are a fantasy, Pickens said, since the world's demand for oil is roughly equal to the amount that is being produced.

Pickens said the media should challenge GOP presidential candidate Newt Gingrich on his claim that if elected he can lower gasoline prices to $2.50 a gallon.

"You've got Donald Trump saying don't pay OPEC $100 for the oil. Just tell 'em you'll give them $50.

"Really? I go into Trump's hotel, it's $1,000 for a suite and I say I'm not going to give you that, I'll give you $200. I'm on the street looking for another place to sleep. You can't tell 'em I'll give you $50 when the world market is $100. It just doesn't work that way."

He said he still favors wind energy, which was a key part of the "Pickens Plan" he put forth in 2008, but the price of natural gas is now so low that wind projects can't compete economically, Pickens said.

With 70% of everyday oil use going to transportation fuel, he said the impact of putting a much cheaper fuel such as natural gas into the market will be to bring the price of gasoline and diesel down.

His current plan is focused on moving trucks to natural gas, but he said President Barack Obama could also urge consumers to commit that their next car will run on a domestically produced fuel, whether it's natural gas or a plug-in electric vehicle.