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Better place files for bankruptcy

Better Place, the visonary electric vehicle venture owned by Idan Ofer’s Israel Corp has filed for bankruptcy protection. The company had pioneered the development of a network of battery swopping stations, and the collapse is a major set back for the development of electric vehicles around the world.

The company was formed in 2007 by Israeli entrepeneur Shai Agassi, who came up with the plan to model the market for electric vehicles based on swapping of batteries in a network of stations, not dissimilar to car washes. The idea was the result of a challenge by President Shimon Peres to a number of entrepeneurs to come up with a solution to make the world a ‘better place’ and intended to stimulate the demand for electric vehicles as the world’s motorists seemed reluctant to take the plunge.

Agassi’s groundbreaking idea was to disassociate the cost of the battery from the captial cost of the vehicle. His point was that when a buyer purchased a traditional vehicle, the fuel is then purchased when required, whereas the cost of a traditional EV included the cost of the battery which is an expensive item ( the incremental cost of electricity is much lower than the cost of petrol or diesel). The idea was to base the charging for EV fuel on the mobile phone market – ie a contract is entered into whereby the user pays at the end of the month for the amount of miles used rather than minutes.

The idea of the swapping station was the solution to the main problem faced by current EV’s the limited range of current Ii-ion batteries. As the current range of most vehicles is around 100 miles, most  EVs are only really of use for short commuter journies where a recharge can be conducted before the return journey is made. As there is a shortage of charging posts, and the time taken to recharge would interrupt most long distance journies, the Better Place solution of a quick visit to a swapping station seemed to be a direct comparison with a visit to a petrol station.

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