Lynne Kiesling
Here’s an interesting New York Times article profiling Shai Agassi, the entrepreneur behind Better Place. Better Place is fascinating and worthy of our attention because it has the potential to be a complete game-changer in transportation by making battery replacement in electric vehicles as quick and easy as putting gasoline in your car.
Yet all these alternatives suffer from a common problem: refueling. The most advanced electric car currently for sale, the Tesla Roadster, runs for no more than 250 miles on a charge, and others can do only 50 miles or so; then they require two or more hours of plug-in time to recharge. The problem of refueling is so significant that fans of electric cars have a phrase for it: range anxiety, the nagging fear that you’ll run out of juice before you can find a charge spot and be stranded at the side of the road. It is the major reason that most Americans, even as they cheer on the development of low- or no-emissions vehicles, are leery of actually buying one. And if people won’t buy them, carmakers won’t make them.
Agassi aims to solve this problem. Going country by country, his start-up firm has begun to construct what it hopes will ultimately be a worldwide network of millions of small-scale “charging spots,” parking-meter-like posts scattered around downtown areas and along highways. But crucially, he is also building roadside robotized battery-swap stations that provide fresh, fully charged batteries without having to wait hours for a charge. It’s a dual system: on most days, his customers would charge their cars by plugging into a charge spot at home or at work; a long drive would entail pit stops every 100 miles or so for a battery swap. Agassi plans to make his money by buying electricity in bulk from solar arrays and wind farms and then reselling it to his customers.
The idea is a little odd, to say the least: a car with a replaceable battery? It is also extraordinarily bold, requiring carmakers to fundamentally rethink the way they build cars. But Agassi, a charismatic entrepreneur who walked away from one of the world’s top software jobs, is “amazingly persuasive,” Shimon Peres, the president of Israel and an admirer of Agassi’s, told me. In barely two years, Agassi has persuaded investors to contribute $400 million, and several countries and states — including Israel, Denmark and Hawaii — have offered him lucrative tax breaks. The French automaker Renault is spending $600 million over three years to develop a car with swappable batteries, to be released in 2011. In Israel, where Better Place has already installed hundreds of its signature blue car-charging stations, Agassi is credited with convincing the nation’s jaded political class that they have an opportunity to actually wean their country off oil. But the question is whether he can convince the most important group of all: customers.
It’s a long article with lots of interesting discussion, definitely worth a read. See earlier KP discussions of Better Place here and here.
Might I just note that Agassi’s plans to buy power at wholesale and re-sell that power to customers is currently illegal in California. By doing that, Better Place would be deemed a utility under California statutes, but more importantly, as a non-IOU, it would be treated as an Electric Service Provider; AB1X, passed earlier this decade, suspended retail choice and the ability of ESPs to sign up new customers. While there is pending legislation in Sacramento to address this retail choice question, Better Place would still be deemed a utility, and potentially subject to CPUC jurisdiction.
The regulatory problem in the United States for companies like Better Place is that it’s much easier to sell the nationalized electric company on this stuff then it is to get buy-in from 50 states and their respective utilities.
If you think about it, the only thing on any car that is exactly identical to any other car is the size of the hole for the gas pump. Everything else is pretty unique in that you can’t take, for instance, a side view mirror on a Camry and stick it on an Accord or the steering wheel from a Civic and stick it on a Silverado. The idea that automakers will standardize across platforms on something infinitely more complex and costly is a big leap. I don’t see it happening without legislation, and I’m not even sure it’s the right thing to do.
#1 You got the business model wrong. Better Place does not sell electricity, they sell miles. Better Place buys electricity from a utility. This is much like a chain of movie theaters – buy movies, but electrons, run electrons through movie sell a service (in this case mobility). Not a regulated utility…
The nations utilities on the other hand are not allowed to build this, as they are only allowed to build behind the meter, not after the meter. They are spreading FUD, because essentially they are trying to extend their monopoly power to a new market…after they decided not to invest in it for more than a decade.
#2 Better Place never said that they expect the batter from a camry to fit in an Accord. they say in the article that every car will have its type of battery and they will stock all those batteries for cars that work with them in volume. The impact of stocking those batteries for multiple cars compared to the complexity of sending our kids to fight in Iraq should give you a tiny pause for thought about whether you should attack someone who is trying to do something good for our country!