Plug in and drive

There’s a lot to chew over in Wired’s profile of Shai Agassi, the entrepreneur engaged in an audacious experiment to electrify an entire nation’s transportation system, and in the process rewrite the automotive industry’s business model.

The nation in question is Israel, with Denmark and Hawaii possibly to follow. Agassi’s idea is that electric cars should be sold on a subscription model, like cell phones, with fees used to underwrite a network of intelligent electric outlets that ensure batteries are always topped up.

The plan is quite a bit more complicated than that, but in essence Agassi is trying to solve the same problem that plug-in hybrids and the Chevy Volt are meant to address: batteries have a limited capacity and take a long time to charge up. Hybrids work around the problem by bolting a gasoline engine on top of the electric motor. Agassi’s start-up, Better Place, hopes to cut gasoline out of the picture altogether by remaking the electrical grid. It’s an audacious vision, and the company has the financing and the partnerships in place to upgrade their prospects from pipe dream to long shot. They hope bring their all-electric cars to market in 2011.

Like I said, there’s a lot to chew over here. A few thoughts come to mind:

* Agassi doesn’t like plug-in hybrids, but his criticism seems overstated. In fact, plug-ins could fit nicely into Better Place’s model. Or, just as likely, plug-ins could co-exist as a competitive mode of transport. It’s even possible that the market will segment geographically. Better Place’s strategy of focusing on small, isolated locations — real or virtual islands — is both ingenious and self-limiting. Plug-ins might fill the gaps in the grid.
* Agassi has hinted that his company would be willing to purchase green power to fuel its fleet. This is like placing a tax on transportation to fund the build-out of renewable energy. Which actually seems like pretty good public policy. (It’s also an interesting commentary that such a system might come out of the private sector, rather than the government.)
* Although electrification of the transport sector is a clear benefit to the environment, the subscription model realigns incentives in ways that may alarm some greens. Remember all those conspiracy theories about how Detroit and the oil companies had teamed up to keep Americans driving huge, inefficient cars? Well, consider the implications of the pay-as-you-drive model for electric cars.

There’s a lot more to be said on this last point. It’s an article of faith among many that “car culture” itself is a problem, and that a green future will involve a lot more walking, public transportation, and bikes. While such a scenario may come to pass, it’s by no means a certainty (nor, it should be said, are such solutions incompatible with Better Place’s vision). The advent of the electric car could mean that the future looks a lot like it does now, only without any gas stations. It’s notable that under Better Place’s model, the cost of car ownership actually goes down, which means miles driven should go up. As alarming as this prospect may sound, it isn’t necessarily a problem. Personal mobility is a wonderful thing, a luxury for many and a necessity for most. If we can have mobility without the environmental cost, then so much the better.

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