IMAGE: ELECTRIC VEHICLE
Project Better Place via AFP-Getty Images
This electric-powered sedan was on display as Renault-Nissan and Project Better Place reached a deal with Israel Monday to deploy such vehicles starting in 2011.
updated 1/22/2008 11:14:27 AM ET 2008-01-22T16:14:27

Israel's government on Monday endorsed the ambitious plan of a private entrepreneur to install the world's first electric car network here by 2011, with half a million recharging stations to crisscross the tiny nation.

Supporters hailed the undertaking as a bold step in the battle against global warming and energy dependency, but skeptics warned that much could still go wrong along the way.

In a signing ceremony with the Renault-Nissan Alliance _ under the slogan "Transportation without fuel, making peace between transportation and the environment" _ Israel's leaders pledged to provide tax incentives to customers to make Israel's cars fuel-free.

The project is a joint venture between Renault-Nissan, which will provide the electric vehicles, and the Silicon Valley-based startup Project Better Place, which will operate the recharging grid. The replacement and charging of the lithium-ion batteries is supposed to work like that of a cell phone battery.

"For the first time in history, all the conditions necessary for electric vehicles to be successfully mass-marketed will be brought together," the companies said in a statement.

The initiative is the brainchild of Shai Agassi, a 39-year-old Israeli-American entrepreneur and high-tech star, who raised $200 million to get the project off the ground.

"Our planet's battery got charged over hundreds of millions of years, and yet we have consumed half the world's oil in one century. In the process, we got addicted to oil, polluted our cities and altered our planet's climate," Agassi said. "Finally, we are running out of out most precious commodity of all — we are running out of time."

Less than a year ago, Agassi quit as a top executive at the German software giant SAP AG to pursue his green dreams. Along with his partner Idan Ofer, he founded Project Better Place, aimed at helping reduce greenhouse emissions by building a network of charging stations for electric cars across Israel.

Gas $6.30 a gallon
Agassi's spokesman said his home country of Israel was the ideal laboratory to market his vision because of its high fuel prices (around $6.30 a gallon), dense population centers and supportive government. In Israel, 90 percent of car owners drive less than 45 miles per day and all major urban centers are less than 100 miles apart, making the use of battery operated cars more feasible than in countries with longer average commutes.

Green cars are also particularly attractive to Israel, which hopes to weaken the political clout of its oil-rich enemies.

"Today is a new age with new dangers and the greatest danger is that of oil," President Shimon Peres said. "It is the greatest polluter of our age and oil is the greatest financier of terror."

Other automakers have produced plug-in hybrid prototypes, which switch from pure electric to gas engine to a blended gas electric mode. But the Renault model is the first mass-produced model designed to be completely fuel-free.

"Zero emission, zero noise," Renault-Nissan Chief Executive Carlos Ghosn said. "It will be the most environmentally friendly mass-produced car on the market."

Ghosn said the cars, with a range of up to 100 miles per charge, would have a top speed of 68 miles per hour — the top speed limit in Israel. And Aggasi vowed that, in the long run, the electric car would be cheaper to operate than one based on fuel.

Israeli leaders said they hoped the country would prove to be a trailblazer in the field of alternative energy. "This initiative will revolutionize cars in Israel and throughout the world," National Infrastructure Minister Binyamin Ben-Eliezer said.

Analyst questions timing
Aaron Bragman, an auto analyst with Global Insight, said he was unfamiliar with this specific electric model but said there were plenty of pitfalls ahead before it could be up to par with the performance of fuel-based cars.

"The electrification of the car is definitely coming. Whether it will come that soon (by 2011) is another question," he said. "It doesn't sound impossible but a lot of things would have to go right for it to happen."

The project has also been met with skepticism in Israel, where newspaper articles have derided it as dreamy and unrealistic.

"Apparently people are again willing to invest in a technological idea without having seen a detailed business and technology plan," wrote Ora Cohen, a columnist for the Israeli Haaretz daily, in November. "Real problems remain to be solved before they start working on virtual ones."

But Agassi enjoys the enthusiastic backing of the government.

"There was a time when people said you couldn't stop smoking," Peres said. "Using gas is like smoking."

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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