The only place where this pays?
They're now being billed as a 'California company' but Better Place, a company that aims to put you behind the wheel of a battery-powered car actually is an Israeli company that I blogged about before here. They're now trying to solve the limitations of battery-powered cars only being able to go 100 miles before needing to be recharged, and the way they're doing it is by setting up battery swap stations throughout Israel. Better Place is trying to solve the biggest challenge to the widespread adoption of electric cars: the limitations imposed by battery chemistry. A battery big enough to give an electric car the same range as the average gas car would be far too large and expensive; and recharging battery packs takes hours at standard outlets, compared to the minutes it takes to refuel a conventional car.Note how expensive it is to operate a car here. Will this work anyplace else? I'm skeptical. This country's car market is unique for three reasons: First, the country is quite small. Second, our gas costs are astronomical (yes, it really does cost $8 per gallon of gas). Third, the cost of cars is driven up by outrageous customs duties (we're looking at buying a 3-year old car for about $20,000 right now - our last car only cost NIS 10,000 and lasted five years, but I shudder at what my mechanic's bills have been for the last five years). Used cars retain their value for way too long.
Better Place will sell a new electric sedan made by Renault that has a range of just over 100 miles on a charge—enough for most daily commutes. For longer trips, Better Place provides battery swap stations, where an automated system switches out a depleted battery for a fully-charged one in less than five minutes. Instead of owning the batteries, the car owners buy subscriptions for a certain number of kilometers of driving per year. They can choose from several plans, much the same way mobile phone owners subscribe to minutes.
The size of Israel limits the number of swap stations needed. What's more, high taxes on gas-powered cars, as well as high prices for gasoline (about $8 a gallon), should help make electric cars more attractive.
Better Place offers one package that includes the cost of the car and three years of driving 25,000 kilometers per year for $46,000. The company says this price amounts to a 35 percent savings over buying and fueling a gas car in Israel over three years. Other packages include a cost of about $36,000 for the car, with monthly subscription fees ranging from $320 to $470 a month for 20,000 to 30,000 kilometers of driving per year, respectively. For both packages, the price includes the installation of a charging station at home.
But - and here's the key - the cost of operating hybrids here seems much lower. I recently heard of someone who drove up north and back on 2 liters of gas. That's cheaper and faster than taking the bus. By comparison, when we rented a 2008 Toyota Corolla three weeks ago, we used an entire tank of gas (nearly $100) to travel about 600 kilometers in three days.
Oh - one other thing about the Israeli market.
Michael Granoff, head of oil dependence policies at Better Place, says the company has 20,000 individual customers on a waiting list to buy the cars, and 70,000 tentative orders from fleet customers. "That's nearly half the car market for Israel," he says.I think the car market in Israel is quite a bit larger than that.
I'm not sure that ultimately battery only is the way to go. People look for the cheapest way to operate car. Unless it's cheaper and/or gets them there faster, they won't use it (which is why public bus transport here in Israel is mostly used by those who don't have cars - it takes forever). I'm not the only skeptic.
Menahem Anderman, founder of Total Battery Consulting, says most major automakers don't think the approach is promising. The swap stations will cause wear and tear to the batteries, he says, and the economics may not prove as attractive as Better Place claims. For example, he says, the prices consumers pay will need to cover the cost of not only the batteries in the vehicles, but also the ones stocked in swap stations.Hmmm. I have to wonder whether the Israeli market is uniquely suited to this because of the factors I described above.
By the way, for those who have forgotten, I represent high tech companies....
Labels: battery-powered cars, electric cars, Israeli driving
posted by Carl in Jerusalem @ 9:42 AM
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