- From the Desk of David Pogue -
> ----------------------------------------
>
> Electric Cars for All! (No, Really This Time)
> By DAVID POGUE
>
> Last Sunday, "CBS News Sunday Morning" broadcast my report
> about Better Place, a radical, overarching plan to replace
> the world's gas cars with electric ones--really, really
> quickly. The nutty thing is, it just might work; the
> streetside charging outlets for these cars are already
> under construction in six countries and two U.S. states.
> (You can watch the story here http://bit.ly/2rGU6g )
>
> As always, there wasn't enough time on TV for the whole
> interview. So here's a longer, edited excerpt of my chat
> with Better Place chief executive Shai Agassi, former SAP
> executive.
>
> DP: Explain how this is different from all the failed
> electric car programs that have come before.
>
> SA: Most of the car efforts were done from within the car,
> and assuming that there is no infrastructure change at all.
> It's as if people were trying to build cars, but skipping
> over the gas station.
>
> We started from the infrastructure. We came up with an
> electric car that would have two features that nobody had
> before. 1) The battery is removable. So if you wanted to go
> a long distance, you could switch your battery instead of
> waiting for it to charge for a very long time.
>
> And 2) It was cheaper than gasoline car, not more expensive.
> Because you didn't buy the battery. You paid just for the
> miles and for the car.
>
> DP: So what will you guys make? What will you do?
>
> SA: We sell miles, the way that AT&T sells you minutes. They
> buy bandwidth and they translate into minutes. We buy
> batteries and clean electrons--we only buy electrons that
> come from renewable sources--and we translate that into
> miles.
>
> DP: What are we talking about here? What's the
> infrastructure you're building?
>
> SA: We have two pieces of infrastructure. 1) Charge spots.
> And they will be everywhere, like parking meters, only
> instead of taking money from you when you park, they give
> you electrons. And they will be at home, they'll be at
> work, they'll be at downtown and retail centers. As if you
> have a magic contract with Chevron or Exxon that every time
> you stop your car and go away, they fill it up.
>
> Now, that gives us the ability to drive most of our drives,
> sort of a 100-mile radius. And that's most of the drives we
> do. But we also take care of the exceptional drive. You
> want to go from Boston to New York. And so on the way, we
> have what we call switch stations: lanes inside gas
> stations. You go into the switch station, your depleted
> battery comes out, a full battery comes in, and you keep
> driving. It takes you about two, three minutes--less than
> filling with gasoline--and you can keep on going.
>
> DP: But it sounds like you're talking about a parallel
> universe, where there are hundreds of thousands of charging
> spots and switch stations. There aren't any.
>
> SA: Well, that's what we're building. If you think of our
> first location in Israel, we will have about a quarter of a
> million charge spots before the first car shows up. Just
> like you wouldn't buy a cell phone on a network that wasn't
> built yet. You have to first build the network. And then
> let the cars come in.
>
> And so we put a massive investment in big infrastructure
> projects: Green jobs. A new electric infrastructure for
> cars.
>
> DP: And has nobody said, "By the way, this is crazy?"
>
> SA: Oh-- about nine out of ten people say it's crazy. But
> the other ones are actually saying "Where can I put my
> money?"
>
> We raised $200 million in a seed round, the largest seed
> round of any startup in history. We raised a $135 million a
> week ago in Denmark to put the same network in Denmark.
> We're raising $700 million in Australia to build this
> network on the biggest island you can find. So this is
> actually getting a lot of support and a lot of funding.
>
> DP: Which governments are actually signing up?
>
> SA: Israel was first. Denmark signed up next. Denmark is the
> host of the next climate change conference, and the prime
> minister really backed this up: They put a huge tax on
> gasoline cars, 180 percent tax, and zero tax on electric
> vehicles.
>
> Australia signed up after.
>
> Then we went to the U.S. Gavin Newsom, mayor of San
> Francisco, coordinated an effort of all the mayors in the
> Bay area to create the next transportation island, the San
> Francisco Bay area. Even though it's not an island.
>
> Governor Lingle of Hawaii was really the driving force
> behind getting us to Hawaii. And then the Premier of
> Ontario announced about a month ago that we're gonna go to
> Ontario. And Ontario, most people don't know, is the
> capital of cars in North America. They make more cars than
> Michigan these days.
>
> And there's a lot of interest beyond these first six
> networks that we've announced. We're talking about 25
> countries around the world, and various different governors
> and mayors in the U.S.
>
> DP: Hawaii's an island. Australia's a big island. Why
> islands?
>
> SA: Contained islands are easier to work with, because you
> have sort of an ecosystem of cars that don't go in and out.
>
> DP: Now so far, these electric cars that are coming to
> market: Tesla, $100,000. Volt, $40,000. How much will one
> of these cars cost?
>
> SA: If you take the battery component out of our car--which
> is what we do; we don't let you buy the battery, we buy the
> battery--then our cars are on par with gasoline cars. So an
> SUV will cost roughly the same as an equivalent gas SUV,
> roughly in the $20,000 range. A sedan will cost roughly the
> same range. About $20,000.
>
> What we also do is, if you're committing to driving a long
> distance--for example, if you're committing to 20,000 miles
> a year--we give you a discount. And a discount can be
> sometimes $50 a month, sometimes $100 a month, towards the
> car. In other words, we pay for your financing of the car.
> And so you get a car that's actually cheaper than its
> gasoline equivalent, depending on how many miles you
> commit. You can go all the way down-- and in the case of
> people who drive a lot, like taxis--all the way down to
> zero.
>
> DP: Free car? If you sign up for the maximum minutes plan?
>
> SA: This is Oprah for everybody. Right? (LAUGH) It's, "You
> all got a free car!"
>
> DP: Now, you don't strike me as a guy with a lot of car
> experience. Why is everybody buying into this vision that
> you, a software guy, are bringing them?
>
> SA: Well, I'm more of an integration guy. So if you think
> about it, even though I was at SAP, SAP is about
> understanding the art of technology, the software part, but
> also understanding the processes of business. And if you
> look at what I did in the past, I managed teams who brought
> about a 100 products a year. We had labs in 25 countries
> around the world. Very, very complex solutions that drove
> the largest companies on earth, including car companies.
> What I bring in is that understanding of complexity of both
> the technology and the economy.
>
> When you look at the problem mobility with a fresh set of
> eyes, sometimes you find solutions that the guys who are
> sort of locked in the inertia of day-to-day business--have
> missed.
>
> DP: What do you think about hybrid cars?
>
> SA: Well, the most successful hybrid car in the world,
> Prius, is roughly around 1 or 2 million cars. Out of about
> 750 million cars. In other words, we're having 0.0 percent
> effect on oil consumption.
>
> During those 12 years, we added 200 million gas cars. We're
> moving really slowly if we're gonna go to hybrid! What you
> need to do is you go to zero: zero emissions, zero oil. And
> you have to scale it to infinity, if we really want to make
> a difference.
>
> DP: I hear a lot that the battery technology just is not
> here for electric cars. It has to work in the Arizona
> summer. It has to work in Fairbanks, Alaska. Short battery
> life, lethal to throw into the junkyard when it's done.
> Have you thought about this stuff?
>
> SA: Yeah, so let's demystify batteries for a second. As a
> consumable, the batteries we're getting today are roughly
> in the range of about $.06 to $.08 a mile.
>
> If you try and find gasoline, in the U.S. you're roughly at
> about $.10 to $.12 a mile. So the first thing is it's
> cheap. Second thing is, the batteries we're using are not
> lead-acid batteries. They're lithium iron phosphate. All
> within the 35 most common elements in nature. So they're
> not dangerous to the environment.
>
> Three: They're consumed for a very, very long time. These
> batteries will last multiple generations. 20, 25 years.
>
> The fourth element is that there's always a better battery
> around the corner. Now in the past, that was a negative
> thing. Because you were afraid to buy a car and get stuck
> with a car that has a battery that's an older generation.
> And then not be able to sell it. It was a very, very
> negative thing.
>
> What we've done by decoupling the car and the battery is, we
> took away that fear. You may buy a car with generation 1
> battery today, and then three years, five years, ten years
> from now, you may get a different battery that's designed
> with backwards compatibility into your car, but gives you
> longer range.
>
> DP: How will it work for a subscriber? Specifically?
>
> SA: Most of what we've done is try to make it convenient. We
> don't want you to pass a credit card when you charge the
> car. We don't want you to pay every time you switch the
> battery. We looked at it from the angle of convenience.
>
> And so we're probably gonna see three different pricing
> models. In some places, you'll see it sort of as
> pay-as-you-go, very much like a gas tank. I mean, if you
> think about it, a gas tank is sort of the prepaid
> phone-card model of cars. You come, you buy 400 miles, you
> drive 'em. You buy another 400 miles.
>
> So they'll be something like that in the base package.
> There'll be a fixed number of miles, plus a surcharge if
> you go more than that--1,500 miles a month or something in
> that range. And then there'll be the all-you-can-drive
> model. You pay one-time fee, you and your family can drive
> as much as you want on that car.
>
> And we like those guys the most. Because effectively, what
> they do is they take the drivers who consume the most oil,
> and spew out the most pollution and CO2 emissions, off the
> road first. 'Cause if you come and tell people there's a
> flat fee, then the guys who drive the most, the extremes of
> the extremes, think you're crazy, and they're the first
> ones who come in and jump. So it's a self-selection process
> of the guys who we want to get off the road first.
>
> DP: Oh. And-- do you have any idea how much that might cost?
>
> SA: It depends on the price of gasoline in the market that
> we're coming in, because we're replacing gasoline miles. So
> if you're in a country where gasoline is at $7, $8 a
> gallon, which is what Europe is right now, the cost of a
> mile is much higher. If you're in the Bay Area or in
> Hawaii, you're paying a lot less per mile. So we need to be
> competitive with the price of gasoline in the location.
> That's why Europe has a significant advantage over the U.S.
> in getting these kinds of solutions in place.
>
> DP: Your critics have had their potshots. What are the
> realistic obstacles?
>
> SA: This is a massive integration project. And everything
> needs to happen roughly at the same time. In other words,
> the cars need to show up at the same time as batteries need
> to produce in scale. At the same time as the
> infrastructure's in the ground. All of that needs to be
> synchronized with beautiful software that runs inside the
> car. And then back-end software.
>
> And then all this has to happen at a scale that is scary, to
> a certain degree. We need to be at 100,000 cars in 2011.
> About 100 million cars by 2016 to 2020. A thousand-times
> growth in production capacity and in installation capacity.
> There's never been a project of this magnitude in history.
>
> DP: No.
>
> SA: But if we don't get a hundred million cars, by the end
> of the next decade, [the world will have] a billion
> gasoline cars on the road--and we're done. We don't know
> how to produce enough oil for a billion cars. So humanity
> needs to switch before we run out of natural resources: air
> and oil.
>
> DP: But aren't you just shifting all the energy producing
> pollution from the individual tailpipes to the power
> plants?
>
> SA: Well, we have committed to only buying clean electrons.
> So we've made a decision that if we put a car on the road,
> we put a renewable source on the grid at the same time.
>
> DP: Aren't the gas and oil industries going to want to
> squash you? They'll have lobbyists and PR...
>
> SA: So, something fascinating happened over the last 12
> months. The price of oil fluctuated up and down, from a
> $100 to $150 to $50 a barrel.
>
> And it drove everybody in the industry crazy. We know what
> to do with oil: We drill, baby, drill. Right? But at $50,
> we can't drill. It's so expensive to drill, that the price
> of the oil doesn't pay for the cost of drilling. The
> fluctuation is worse to the car companies and the oil
> companies than any stable price, high or low. And so what
> all these car and oil companies are asking for right now is
> some sort of a stabilizer.
>
> They need a company that would give an alternative that
> would be fixed in price. And they want it to be stabilized
> roughly around $75 to $100 a barrel. That's what they tell
> us. "$75 to $100 a barrel allows us to find marginal oil."
> And so they're actually liking us now. They want us to
> succeed because we're viewed as a sort of a stabilizing
> buoy.
>
> DP: But you're also viewed as someone who's trying to end
> the oil industry.
>
> SA: Well, they don't think it's gonna happen that fast.
> (laughs)
>
> DP: It seems like you're the gatekeeper of all this. You
> could become Bill Gates. You could become the guy who
> changed it all and became fantastically wealthy and
> successful. Have you crunched the numbers at all, and said,
> like, "Yeah, I'm glad I quit SAP"?
>
> SA: First of all, I'm already glad I quit SAP. Not because
> SAP isn't a fantastic company--I love SAP--but because
> there's a purpose in life. And that higher purpose is much
> more important than making money. I've been extremely
> blessed and successful. I sold my first start up at 30. I
> sold it again at 33. I made enough money in both cases that
> my kids don't need to worry about money.
>
> So I've never done anything for money that point, at age 30.
> But when you find a great purpose in life, you gotta pursue
> it. It's when your big question finds you. You can't let
> it go.
>
> One of the things that we've done that is very interesting,
> unique for a first mover, is, every government we go in to,
> we ask for one thing: "Make sure that you build an open,
> standards-based network." So that we can't lock any
> competitor out, and competitors can't lock us out when they
> show up. We want to make it so that the networks are so
> open, that I can roam from my network to their network and
> back.
>
> We believe that if we align all the vectors together, we'll
> get adoption much faster. We had to opt for either speed or
> greed, and we picked speed.
>
> DP: So speaking of these networks. When I plug into one, how
> does it know who I am?
>
> SA: We have a protocol that goes between the car and the
> charge spot that says, "I'm car number 41, I'm seeing
> charge spot number 72." And the charge spot says to the
> central computer, "I'm charge spot 72, I'm seeing car 41."
> And the central computer says, "Okay, relax, I know you're
> there. And I'll tell you when you can start taking power."
>
> And it tells them to take power when the utility, the
> supplier of electrons, says "I got power for you, for that
> many cars." Utilities tell us every three seconds how many
> cars can charge. And based on that, we moderate. The cars
> that need it the most importantly right now. So we sort the
> priority of the cars, based on how much they've got and how
> far they can go, and what's the probability the driver will
> show up again. If you came into work, and you're usually
> ten hours at work, you won't charge immediately in the
> morning. If you just came home, it's 5:00 and you don't
> leave, usually, you won't get charged.
>
> But right as you park your car, you can press a button that
> says, "I need juice now." We put you in the top of the
> line.
>
> So there's a lot of software, very simple. Mostly it's one
> click. But we do a lot of management behind the scenes.
>
> DP: Do I need to install a charging spot in my garage?
>
> SA: Yes. It's about $250 to $300.
>
> DP: So I can't just use a regular power cord?
>
> SA: You could, but what we're trying to do is make it so
> that when you plug in, YOU don't pay for the electricity.
> WE pay for the electricity; you only pay for the miles.
>
> DP: What's the best hope of when we'll start to see these
> cars in America?
>
> SA: Our stated goal is that mid-2011, we'll be in mass
> consumption. And the fist sites are Israel, Denmark and
> Hawaii. The second half of 2010, we'll be running a massive
> test: tens of thousands, hundred thousand spots in Israel.
> And right after that in Denmark with. Testing our software,
> testing our hardware, testing the switching, the entire
> network.
>
> We've just installed the first charge spots in the U.S., in
> about 50 parking lots, tested the equipment for
> installation. In a couple months, we're installing the
> first switch station in Japan.
>
> It's about 2 and a half years of testing, from now till the
> mass release.
>
> DP: Wow, that's really fast.
>
> SA: For a transformation of this magnitude, it's immensely
> fast. Yes.
>
> DP: By the way, how do you stop teenagers from just walking
> by and unplugging everybody?
>
> SA: Oh, it's a secret. And they shouldn't try it. (LAUGH)
> No, you can't just plug it out. You need your keychain.
>
> DP: Oh, so the outlet locks onto to the socket?
>
> SA: It has a mechanism in there to avoid vandalism.
>
> DP: Oh. You've thought of everything.
>
> SA: No. But we've thought of some of the things. (LAUGH)
>
> http://www.nytimes.com/2009/03/19/technology/personaltech/19pogue-email.html?8cir&emc=cir
>
> ..................
>>> Visit David Pogue on the Web at DavidPogue.com
> http://www.DavidPogue.com?8cir&emc=cir
> ..................
>
>
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