1) Go to Window -> Preferences -> Java/Installed JRE's
2) Make sure your workspace has both a java7 jre and a java8 jre.
3) setup a karaf 3 server and use Java 7 for it. This is usually done in the runtime page. I am not sure on Lars's specific steps, but I would imagine he is selecting a specific jvm, and setting it to the java7 vm.
4) After the server is created, double-click the server to open the server editor
5) Click on the 'runtime' link in the top-left section of the editor
6) When the runtime wizard pops up, change the runtime's jre to your java8 jre.
7) Finish the wizard, and then SAVE THE EDITOR
8) Click the 'launch configuration' link in the server editor
9) Verify that the program arguments, vm arguments, and classpath have been modified to using the java8 paths and jars.