The Wall Street Journal reports that Better Place Inc. has demonstrated its battery exchange technology for the first time in Yokohama, Japan. The company has posted a video demonstration of the process in which a specially designed electric car has a depleted battery exchanged for a recharged battery in under a minute. Here are two interviews with Better Place founder Shai Agassi explaining the technology and vision for his company:
Click here for CNNMoney Video
“We’re AT&T, we’re not Nokia”
In the CNBC interview, Agassi compares his company to a cell phone network operator that supplies a service but does not manufacture the device. Agassi’s firm has no intention of building cars. The Wall Street Journal article noted that the company has entered into a partnership with Renault SA and Nissan Motor Co. (OTCPK:NSANY). The manufacturer will build vehicles designed to have a swappable battery for Better Place’s demonstration projects in Israel and Denmark. The company expects to roll out the service in Israel and Denmark in 2011. Private equity firms have provided approximately $150 million for each project.
Justifying Exchange Station Costs
Better Place has a compelling story and the concept of exchange stations would work very well if electric car ranges remain relatively low and battery recharge durations remain high. Drivers do not want to wait excessive amounts of time to recharge batteries while on the road so the idea of being able to swap a depleted battery for a recharged battery may be very attractive. The challenges include standardization of electric cars and batteries to be compatible with exchange stations as well as the cost of establishing a widespread network of exchange stations. I suspect that achieving the necessary network will be easier in small countries like Israel and Denmark compared to vast countries like the United States.
Improvements in Electric Car Range
Perhaps the biggest challenge to Agassi’s vision will come from improvements in battery technology that may make exchange stations less compelling. BYD has developed a revolutionary electric car with a 250 mile range which is far longer than other electric vehicles. Perhaps more significantly, BYD’s battery technology permits a 50% recharge in only ten minutes (a full recharge requires seven hours). This means that the driver of BYD’s e6 vehicle will have a relatively long initial range which can be extended in a short period of time for another 125 miles. For all but the longest road trips, this should be adequate even in a large country like the United States. While it is not yet clear whether special equipment is needed for the ten minute “quick charge”, any recharge point is likely to be less costly than the equipment required for battery exchanges. Furthermore, standardization of battery location and design within the car would not be needed since the battery would be recharged in place rather than exchanged.