Thursday, April 9, 2009

Riding a new wave of power

Gerard Wright, Palo Alto, California 
The Age, April 10, 2009

OK. SO this is the future. Or maybe a future. You glide noiselessly towards the bank of what used to be service station pumps. The indicator on your key has changed colour from the blue that meant a full battery at the start of the trip. The dashboard computer screen shows the battery is at 30 per cent and needs to be replaced.

More on electric cars at

The fuel needle hovering near E used to mean a quick calculation on the location of the nearest petrol station and how much petrol was left. Now the computer performs that calculation. If it is a short trip, to the office or a shopping centre, it announces the location of the nearest points where the car can be recharged while it is unoccupied. If it is a long trip, the nearest station where the battery can be replaced, free of charge, is shown. That transaction will take about five minutes, or about the time, from start to finish, it would take to fill and pay for an ordinary fuel tank at a service station. The new battery will run for 160 kilometres.

Who'd have thought that we would be referring to cars as we do everything else — to analog and digital? To then and now?

The analog auto ran on petrol. Its internal combustion engine blew fumes. With the right engine and the right driver, at the right speed, it could emit a sound that some found sexy, or at least addictively visceral. For many 18-year-olds, it represented the portal into adulthood, freedom and independence.

And now, after a century, that transition point is closing. The man slamming the door shut is of average height, with a handsome, open face, and a mop of dark straight hair that has a narrow streak of silver through the fringe. In the way of the Silicon Valley mogul, which was his former calling, he dresses down, in a black bomber jacket over a grey, unbuttoned business shirt, and off-white pants.

His voice is richly, deeply American, which is one of several oddities about Shai Agassi, citizen of Israel, son of an Iraqi father and a Moroccan mother, with enough money to ensure that he never has to work again, leaving him time for his other job — changing the world.

Agassi's notion is to wean the world off its addiction to oil: in particular, oil's use as petrol — and in so doing, pay what he says are debts to the past and the future.

The idea is at once simple and staggeringly complicated: replace cars that run on petrol with their equivalents that run on electricity, via a quickly rechargeable, easily replaceable battery. It's a program that owes much to the mobile phone industry, which has shown how batteries can be reduced from the size of a brick to the size of a fingernail without affecting their output or lifespan.

It helps to think of a car as a mobile phone, the owner of the car as a subscriber, and Agassi's company, Better Place, as the service provider. In this case, the service is a power grid that recharges and/or replaces the car batteries of subscribers on demand, at home, work, or in designated car parks. The batteries have a range of about 160 kilometres, and a lifespan of 400,000 to 800,000 kilometres.

The challenges for Better Place are many, starting with consumer mindset, including several well-entrenched and historically favoured corporate and cultural rivals, and, most of all, replicating, on a smaller scale, "the biggest machine ever invented", in Agassi's words, the electric power grid.

The aim of Better Place is that the world's cars, replaced at an annual rate of 70 million, will run on electricity from a grid within a grid, accessible from anywhere in the world.

Headquartered in Melbourne, the company's timetable calls for Melbourne, Sydney and Brisbane to be connected by 2011, with a mass launch in 2012. The intended result is a lighter carbon footprint. A Deutsche Bank analysts' report — provided, it must be said, through Better Place — estimated the average vehicle would consume as much power, in the course of a day, as five lightbulbs.

That report, written 12 months ago, crunched a lot of numbers in two dense paragraphs. At the end, it concluded that a car could run on electricity for less than half the current cost of petrol.

It noted, too, the rapid evolution of the vehicle industry: "Investors should be aware that motor vehicle technology has the potential to change more significantly over the next five years than it has in the past 100 years."

"When you look at the car makers and the car markets," says Agassi, "you've got to analyse which countries are identifying already that there's been a shift from Car 1.0 to Car 2.0 — if you want to think about it that way, the first hundred years to the next hundred years.

"And some governments are putting money into defending the last hundred years of car makers, and some countries are basically saying, 'You better invest in the future, so that we attract the next supply chain, not the last supply chain.'

"It's sort of the question of 'Should I help Sony build a better Walkman, that you're using here, (gesturing to the analog recorder, sad and black and clunky, though reliable) or should I get Apple to open up its Asian iPod headquarters in my country?' "

It should be said that Agassi is not given to extravagance, at least in personal tastes. With his father, Reuven, he sold two software companies they co-founded to German computer giant SAP for $US410 million ($A580 million). Agassi was a rising star in his late 30s, president of SAP's product and technology group, and a member of its executive board before his resignation in March 2007.

Parked outside the Palo Alto office complex, where the Better Place administration is headquartered (its research and development takes place in Tel Aviv) is a six-year-old Toyota RAV4, metallic grey, with "Electric Vehicle" stencilled in blue on both sides. It is Agassi's ride, testament to his affinity for the electric car, and also an unlikely collector's item, as one of only 1300 made by Toyota.

A question about whether the economic crisis will serve as the necessary tipping point for mass adoption of electric vehicles sends Agassi careering off in an unexpected direction. The answer traces the history of energy use, from whale oil for home heating, to the trial and massive error of early attempts at an electricity grid. He explains how one technology leap-frogged another at a critical time — the development of the so-called horseless carriage — and how, as a consequence, 100 years of American and European brainpower shaped the evolution of the internal combustion engine, while the battery remained inert, heavy and toxic until the late 1980s.

Agassi brandishes his BlackBerry. Ninety years of inertia until the arrival of "the brick", the first mobile phone. It evolved into something smaller, by increments, 50 per cent smaller and cheaper, every five years.

"It wasn't that oil was so much better — electrons are better than oil — we just didn't have supply and demand at the critical time of the 10 years of formation of the industry. We had 90 years of no research.

"Sorry about the history lesson," he adds. "I get carried away."

The topic pivots from the past to the future. Agassi paints a vivid, contrasting picture of the prospects of the first country to embrace not just the Better Place model, but the possibilities of the infrastructure supporting it, as well as the consequences of sitting tight.

"If the government wants it to be slow, you'll leave it effectively with no policy and no support, and then the early adoption will be the green-minded individuals who are willing to put a premium on being first," he says.

"We've had early discussions, but I can't tell you that we've made too much progress on policy. You have to remember, what we believe is it's not our job to make policy, but to share experiences from other locations. We will still come to market, but it's a question of the desire of government to accelerate or slow down adoption. If a government believes that the transition to electric vehicles is inevitable, it should be every government's desire to make that shift happen earlier in their country.

"In particular, if you have a local car industry, you don't want to be the last one stuck with the four-litre engines being made in your country. You want to be the first leading the transformation to electric cars, so I think these are just inputs for policymakers to go make up their minds."

Having waved the stick, Agassi then offers the carrot. "Batteries are the new oil," he notes. "If it (a battery manufacturing facility) was built in Australia, with renewable sources of energy in the Australian desert in a variety of different locations, and close to ports, 50 to 60 miles from ports, it could be an amazing new industry.

"Australia has the potential of generating tonnes of solar. There is no reason why Australia couldn't build its own virtual oilfield, much like Israel's doing, with one exception — Australia has tonnes of land to put solar plants, for all the cars in Australia. If you think about it, over a period of 10 years, Australia could build a 50-gigawatt solar plant in a heartbeat, all made by Australians, all installed by Australians.

"There's nothing in science or technology that's missing. It's a question of will and a question of financials."

Agassi dreams — or perhaps conceives is a better word — big.

His ideas began as a white paper, written after a 2005 leadership conference. He took it to government leaders around the world, offering it as a suggestion they could act on it.

One of those leaders was his own country's President, Shimon Peres.

The response varies in the telling, but Agassi's recollection is that Peres phoned him. "You have to start a company. You go raise the money, and then you do it with a private company."

"No, no, no, no," Agassi responded. "I have a job."

"No no, no," Peres said. "You have to quit your job. You have to do this.

"What is that job with SAP you've got? It must be such an important job if you're willing to do that job and not care about saving your country or saving the world. Can you explain that job to me?"

Agassi had no good answer. So now he leans back in his chair in the conference room of the anonymous office block in Silicon Valley, and smiles.

"It's manipulation. Jewish manipulation. We do it all the time."

Gerard Wright is a freelance journalist based on the US west coast.

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