The venture-backed firm Better Place has a vision of how the electric-car business — that most historically stalled of industries — will finally reshape the automobile landscape in the next decade.
Two years after the company was born under the guidance of former SAP executive Shai Agassi, Better Place’s CEO, it sees the future of transportation as all-electric, rather than hybrid. Further, it expects that so many more drivers will buy these vehicles, powered by rechargeable and removable batteries, that the electric car will turn today’s carbon-emitting gas-guzzler into the dinosaur that we’ve long suspected it is.
The role of Better Place in this new industry will be what CFO Charles Stonehill calls “the seller of electric miles,” vaguely similar to the way wireless communication companies provide minutes to cell-phone users. Auto-powering lithium batteries, like the ones that will be provided inside new cars, could be recharged or easily switched out — flashlight-style — for fully charged units that could be purchased from Better Place, as part of an “electric mileage plan.” Under that scenario, drivers of electric cars would prepay for a number of electric miles per month or year, along with battery switchout or recharging support, and service at “charge stations” that Better Place would build and operate in cities around the world.
Palo Alto, Calif.-based Better Place is currently developing the technology for building its envisioned electric-recharge grid in partnering cities and countries. The plan calls for charge points to eventually be installed in locations, including parking lots and public parking spaces, where drivers could charge their electric battery for trips less than 100 miles, the current maximum distance battery technology allows electric cars to travel.
For longer trips, drivers generally would use the battery switching stations that would be built along highways and roads. There, a swap would be made for their original battery , thus avoiding the long recharging process that electric batteries otherwise need. Better Place also envisions providing software that would serve as an “operating system,” notifying drivers how much electricity remains, and where the closest recharging or battery-switching station is located.
This year, 100,000 charging spots will be built in Better Place’s first test-market country, Israel, where the company already is paired with Renault-Nissan for electric vehicles that are compatible with Better Place’s technology in the next few years.
The company’s credo is that the support of governments — from national to municipal — is vital to creating the infrastructure needed to support electric vehicles. Leaders in Denmark, Japan, Australia, and Ontario, along with the San Francisco Bay Area and Hawaii, also have committed to supporting public and private investment in building Better Place grids. Last November in California, for example, the mayors of San Francisco, San Jose, and Oakland announced the goal of turning the Bay Area into the nation’s electric car capital. Lending support to the overall effort, President Obama has made green initiatives and energy efficiency goals of his administration.
Managing the finance operations for Better Place, and managing its vision, is former investment banker Stonehill, an Oxford University graduate who formerly was nonexecutive chairman of Panmure Gordon & Co. PLC in London, and before that global head of capital markets for Lazard Freres, head of investment banking for Credit Suisse First Boston, and head of European equities and equity capital markets for Morgan Stanley.