Analysis On a trip to Israel two weeks ago San Francisco mayor Gavin Newsom heard more about the plan to switch the country from petrol vehicles to electric, and was so impressed he bought the project. Now Newsom wants his city to be the first in the US to adopt electric cars wholesale, and claims that with the will, "you can be off oil in 10-15 years, 100 per cent."
Which is pretty much what Project Better Place founder Shai Agassi has in mind for Israel - the whole country driving electric by 2020. But can it work for San Francisco?
Ironically, although Newsom professes to be an old friend of Shai Agassi, whose start-up is based in Palo Alto, Project Better Place's first ventures have been overseas - country-sized, with Denmark following on from Israel. Speaking to The Register immediately after the Danish launch Agassi seemed unenthusiastic about prospects in the company's home state, where the electric car has so far been the poster child that never really made it off the poster.
But there are reasons for that, and related reasons why it seems likely that it's San Francisco's sloganeering mayor, not Agassi, who's the suitor in any talks. Agassi would certainly like to add a showcase city-sized implementation to Project Better Place's portfolio, but the city itself is just the venue, and there's a whole bunch of game-changing economic components that will have to go into place before Newsom's wishes can come true.
The Israeli and Danish rollouts will both be using vehicles from Renault-Nissan, 'normal' sized saloons with a range of around 120 miles on a single battery charge. A fuelling infrastructure and a viable pricing model are however at least as important as the existence of a reasonably broad range of electric vehicles, and this is where Newsom is going to need a few other players on board. Newsom can put in a sprinkling of charge points for the city's (currently, three) plug-in hybrids, for his own Tesla roadster and for the smattering of EV believers around the Bay Area, but it'll take a lot more than that to make electric power feasible and compelling for hundreds of thousands of drivers.
In Denmark and Israel, infrastructure is being provided with the aid of local power companies. A network of battery swap stations will be the 'petrol' stations, while roadside plug-in points will allow vehicles to be charged when they're parked. Shai Agassi is also proposing mobile phone style pricing models, where you pay for the service rather than the hardware (which is subsidised or even free), and where the service provided is measured in distance travelled rather than power used.
All of these pieces are intended to come together in order to produce a tipping point. Automobile manufacturers come on board on the strength of guaranteed volume sales, and the service providers are there in expectation of being able to make sufficient money from selling power to be able to provide the hardware subsidies and make a reasonable profit from selling electricity. The subsidy means that the upfront cost of the car is lower than the petrol equivalent, hence there's volume demand, and hence - says the plan - the whole virtuous circle kicks off.
So Newsom, who says he's talking to possible partners, really needs one or more companies who want to be the AT&T of automotive electric to put their hands up. They'll need to be prepared to put cash up front for vehicles, and probably also to invest in an extensive network of charging points, presuming San Francisco isn't willing to foot the bill on its own. In addition, they'll need to build a network of swap stations and to implement efficient billing systems that can manage the whole affair. All of this doesn't necessarily have to be done by one company, but if there are several involved they're going to have to be able to work very closely together.
A San Francisco deployment would also face problems in addition to those in Denmark and Israel. A French auto maker might not entirely hit the spot in the US, nor might the compact saloon that Renault and Nissan have just recently unveiled. But Agassi promises that electric cars in all shapes and sizes will be available, and other manufacturers will be producing production electric vehicles over the next few years.
Pricing might also be an issue. The Israeli and Danish governments have both promised substantial tax discounts on electric, and while the US government offers some tax breaks on alternative fuel vehicles, these probably aren't enough on their own to make an electric vehicle purchase an obvious no-brainer. Lower US gas prices might also make it harder for the service provider to make back subsidy costs out of power sales.
So it's a very tough challenge Newsom has set himself, considerably tougher than the one faced by the Israeli and Danish ventures. Does he grasp this? Possibly not - Newsom issued a directive in September 2005 requiring city fleets to purchase alternative fuel vehicles, but according to the San Francisco Examiner the city has achieved this in less than 30 per cent of its vehicles. City departments that continue to buy unleaded fuel vehicles do so on the basis of exemptions granted because no viable alternative-fueled vehicle, so here you could say that Newsom talked a good game, but that the plan was never feasible. Now he needs to prove to everybody that the electric car city plan isn't deja vu. ®