Better Place's Tokyo Battery Swap: A Test to Show the World

Last Updated Apr 27, 2010 9:30 AM EDT

TOKYO -- Shai Agassi is out to prove to the world that electric-vehicle battery swapping works. He's cleared the hurdle of finding investor capital, but he still needs to convince automakers to produce cars with battery packs that can be quickly switched. Agassi is a protean character, but he's not yet making his own cars.

On Monday in downtown Tokyo, his company, Better Place, put on a show for the press, and the technology worked well. The idea with battery swapping is that cars can pull in, receive a new pack in a quick automated operation, then be on their way without having to pause six to eight hours for a recharge. In Better Place's model, swapping is for long trips and recharging stations are for commuting and other short hauls.

Under Better Place's plan, it owns the batteries and customers pay for miles driven (as cell phone users pay for minutes.) The scheme's success depends on consumers not having a proprietary attitude toward their batteries, as some now have to the engines under their hoods.

The Japanese press likes a good show. Agassi's battery-powered Nissan taxi rolled down the ramp to a fanfare of kettle drums, and Better Place was on its way to proving its point. Battery swapping definitely does makes total sense for taxis, which are housed in centralized garages, with 24/7 operations that make stopping for a six-hour charge more than problematic.

Better Place, launched in 2007 by Agassi, a Israeli-born entrepreneur and computer industry veteran, made a strong impression out of the gate with its plan to wire entire countries for electric cars. Today, those countries include Israel, Denmark, Australia, Canada and the U.S., and battery swapping--changing spent packs with fresh ones to accommodate longer trips--was part of the Better Place model from the beginning.

It has also been the most controversial aspect of the otherwise largely applauded Better Place plan, because only Renault has so far agreed to build cars with swappable batteries. The company is reportedly in talks with other automakers on the subject. So the three-month Tokyo demonstration project, in partnership with the Japanese government and taxi operator Nihon Kotsu (which also runs hybrid Priuses in its fleet), was a vindication in more ways then one. The 1,000 yen taken in from an early taxi passenger also represented Better Place's first-ever revenue. "This is for the shareholders," Agassi said.

"Taxis are the toughest test for EVs," Agassi said in a press conference speech. "A year ago in Yokahama, we demonstrated we could switch a battery out of a car, now we're driving on the street and picking up passengers. Clearly, EV taxis are not viable if they have to stop and charge for six hours. These cars can go for up to six hours, then swap in a battery in 59.1 seconds and be on the road again." By 2022, he said, "don't be surprised to see that every single taxi is electric."

Agassi described his vision on video: The Tokyo project involves three locally converted Nissan (NSANY) Rogues, and will last for only 90 days, but could be extended. Tokyo is a good test bed because it is a very taxi-dependent city -- according to Better Place Japan President Kiyotaka Fujii, its 60,000 metered cabs are more numerous than those in London, Paris and New York combined.

According to Fujii, Tokyo's taxis (the largest fleet in the world, some powered by natural gas) are two percent of vehicles on the road, but produce 20 percent of emissions. Better Place likes it that the taxis become rolling advertising for battery swapping. Ride in the back and you can pick up a brochure about going electric and watch a video about the pilot project.

Better Place's next step is a full test of all of its components, including both public and home-based charging stations, in Israel before the end of the year. The company plans to put 100,000 Renault-built EVs into Israel and Denmark, and is planning a commercial in Israel by late 2011. The dates in Better Place's other launch markets are less certain.

In January, Better Place lined up $350 million in equity financing from HSBC, which now has a 10 percent stake in the company

In response to a question from BNET Auto, Agassi said Better Place has its eye on other global taxi fleets. "We are in advanced discussions," he said. "There are many places where they're looking favorably at it but want to come to Tokyo and see it working."And the company is also eying two other forms of high-mileage, often local transportation -- delivery trucks in the fleets of large companies like FedEx and UPS, and para-transit, which offers rides to medical patients, the handicapped and the elderly.

Photo: Jim Motavalli