There isn’t going to be a single answer either. The solution isn’t simply drill more, build more hydroelectric, build more nuclear, windmills, or solar. By outside the box I mean think locally. Geothermal works in many places, but not everywhere. you have to be able to drill very deep holes in the ground, and that just isn’t practical in some areas due to the geology. Big solar power generation plants may work in some areas, but in others it may be a better idea to foster policies that encourage individual homeowners to invest in generating their own power. Battery technology is already capable of storing enough energy to power a home over reasonable amounts of time. If enough homeowners installed photovoltaic panels and stored energy they weren’t using, or sold it back to the grid, then power generated by existing nuke plants and hydroelectric dams could be diverted for use in more consuming loads, such as a car factory or something.

The ability to scale back our use of finite resources is very real and very practical. I don’t think we will ever be completely independent from oil, but we can certainly become less dependent on it.

I don’t know where you got the idea that nuclear power doesn’t require just as many transmission lines as any other type of electric power. Transmission lines are an issue regardless of how your electricity is generated. Just because it is generated a certain way doesn’t change the need to transmit the generated power from its origin to its distribution network.

Only certain types of solar power require water. There is a parabolic dish technology that focuses sunlight on pipes full of water. The water heats and creates steam that is used to generate electricity. The steam ends up in the atmosphere where it is returned to us in the normal cycle of precipitation. Photovoltaics use no water. They contain materials that react to certain frequencies of sunlight. Electrons are excited in these materials that become useful as voltage. The power generation technique that uses the most water? Nuclear. Though one could argue that hydroelectric uses more water depending on your use of the word uses.

Now, while there is no argument that nuclear power is the most capable technology for generating massive amounts of electricity, there exist some very real downsides. Safety is one. If there were to be a building boom of nuclear power plants, it would only take one building contractor to cut one corner and the results could be catastrophic. The fact that nuclear power plants make good targets for sabotage is another. Pollution is a huge factor. While nuclear power is carbon free, nuclear waste is a byproduct. That stuff doesn’t go away in our, or our kids great-great grandkids lifetimes.

Solutions? I am a big fan of photovoltaics. They are initially expensive, but as the technology refines, the prices will come down. I am not going to completely address your misunderstanding of smart grid technology right now, that is another very long post. To be short though, if the government wanted to raise taxes on those that use more electricity, all they would have to do is read your meter. That technology already exists and has for quite some time. Back to photovoltaics. Instead of many great big power generation stations, create incentives to put them on individual homes. Many municipalities already have a bidirectional type of grid that allows homes that generate their own power to pipe any excesses back to the grid. Power companies pay for that stuff. Existing power sources would then be more capable of supplying power to big factories and businesses. Invest a whole lot of money in energy storage technology. That is one of the next big revolutionary ideas. As it stands electricity must be used as it is generated when speaking of large scale use. Geothermal power is wonderfully efficient if your geography and geology allow for it.

People in the U.S.A. aren’t thinking outside the box enough where meeting our future energy needs are concerned. If we don’t start committing more resources to those needs we are going to end up buying all of our technologies from European countries. I’m not kidding either.