EQF, the problem with the energy conversion efficiency is that every time you convert from one form to another, there is a loss because you cannot convert 100%. Entropy and all that.

The idea you propose, no matter the medium used, involves two conversion steps. Even if both steps were 90% efficient (which off the top of my head is probably VERY generous), that represents a total loss from one end to the other of 19%. If the conversions were only 80%, then the total loss is 36%.

According to wikipedia, a quoted reference gives US electric transmission line losses in 2007 as only 6.5%.

So, that means that in order to use some other medium than electric transmission lines, you'd need conversion efficiencies so high as to make total losses on par with wire in order to be competitive. Alternatively, if the total costs involved were lower than wire then higher losses can be offset by lower costs.

And, something I found in that same article is mention of the longest undersea transmission line as being 360 miles. This implies to me that direct wire transmission of any electricity is a viable method for any energy island within this distance of the shore.

Further, I feel then that alternative forms of energy storage would only be viable if they were produced and consumed directly, for example, hydrogen produced from seawater electrolysis and then consumed directly in hydrogen powered cars (which have serious safety issues not addressed here).

http://en.wikipedia.org/wiki/Electric_power_transmission

It is always best to generate directly the form of energy to be used directly to reduce conversion losses.

Brian