{"id":699726,"date":"2010-03-24T08:26:00","date_gmt":"2010-03-24T12:26:00","guid":{"rendered":"tag:blogger.com,1999:blog-9864176.post-467500316582835906"},"modified":"2010-03-24T08:32:01","modified_gmt":"2010-03-24T12:32:01","slug":"will-better-place-make-it","status":"publish","type":"post","link":"https:\/\/mereja.com\/index\/699726","title":{"rendered":"Will Better Place Make It ?"},"content":{"rendered":"

Greentech media has a look at the prospects for Shai Agassi’s Better Place<\/a> venture – Will Better Place Make It?<\/a>.<\/p>\n

Can three cents be transformed into billions of dollars?<\/p>\n

That’s the big question when it comes to Better Place, the well-funded start-up that wants to put people into electric cars. Driving a gas car costs about 12 cents a mile when gas costs $3 a gallon, says Jason Wolf, vice president the company’s North American division.<\/p>\n

Electricity, on the other hand, costs about 3 cents a mile: a kilowatt hour costs around 12 cents and a car can go around 4 miles on a kilowatt hour. A battery for an electric car, meanwhile, will cost around 6 cents a mile over a 200,000 mile lifetime.<\/p>\n

Since Better Place says it will supply the electricity and batteries to consumers, the company has a margin of 3 cents per mile (12 cents minus 9) before potential customers complain about the higher cost of going electric. Granted, 3 cents doesn’t sound like much: I harvest more loose change than that every time I do laundry. And Better Place proposes building thousands of charging stations, hundreds of battery swapping stations, and devising software so these cars won’t crash the grid when charging.<\/p>\n

But look at it from another perspective. There are around 200 million drivers and 254 million vehicles in the U.S. and insurance companies say the average person drives 12,000 miles a year. That comes to 2.4 trillion miles, or $72 billion of potential three-cent transactions per year. Even one percent of that would probably placate investors. And in Europe and Asia, higher gas prices boost that 3 cent margin to 9 or 12 cents. Additional revenue can come from selling semi-depleted batteries to utilities, which isn’t part of the above calculations.<\/p>\n

And with the battery separated from the car, the down payment and resistance toward going electric goes way down.<\/p>\n

“When you buy a Toyota, you don’t buy eight years of gasoline,” Wolf said. “You take out the battery and now you have a much, much cheaper car.”<\/p>\n

Big math problems like that, along with their inherent uncertainties, make Better Place one of the more intriguing companies in greentech today, or in any market, for that matter. In a short period of time, the company has joined the ranks of Google, Apple, Microsoft and Tesla Motors as a subject of endless debate and speculation. How did they raise over $700 million? How much have they spent? Will car dealers and manufacturers work with them?<\/p><\/blockquote>\n

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