Bay Area seeks to become electric-car capital

The San Jose Mercury News reports that, since its founding in 2007, Better Place has raised $200 million in venture capital. Mr. Agassi says he has backing from Morgan Stanley, Goldman Sachs, and the Macquarie Capital Alliance Group. He does not plan on asking the cities for money.

In an interview with The Wall Street Journal, Agassi said that the $1 billion would be raised over three years or so, with about $200 million needed initially.

For their part, San Francisco, Oakland, and San Jose will expedite permits for building charging stations in homes, businesses, and public parking spaces. The cities will also offer incentives for businesses that install charging stations, as well as programs for bulk purchases of electric vehicles for state- and municipal-government fleets.

The plan would also encourage drivers to take advantage of a federal incentive, which offers tax credits of up to $7,500.

On the same day that the plan was announced, the Global Venture Lab at the University of California, Berkeley, released a report that found that, in two decades, adoption of electric cars by 39 percent of American drivers would lead to an annual $175 billion in gasoline savings for US consumers, while the battery industry would experience a $120 billion gain, all with only a "moderate" burden on the power system. Such widespread adoption of electric vehicles would significantly decrease the US trade deficit, the report found.

The San Francisco Chronicle's editorial board welcomed the announcement, saying that the Bay Area is well suited to electric vehicles. But it expressed reservations about the potential monopoly power of Better Place and about the hurdles presented by the current financial crisis:

With one firm controlling the charging stations, there needs to [be a] fair way to determine how much drivers will pay for the service. While the electric option may make sense long term, there are short-term concerns such as dropping gas prices and credit woes that could undercut investment.

Prominent green futurist Alex Steffen was also optimistic about the plan. Writing in his online ecomagazine, Worldchanging, Mr. Steffen called it "precisely this kind of an investment in the infrastructure that's needed to really get innovation and uptake rolling." He also tries to put the program's billion-dollar price tag in perspective:

[W]hen I read one billion for this project, I thought about the roughly one trillion or so we're expected to dump into economic stabilization and recovery programs, all told, and wondered if even half of that went into new bright green infrastructure, what we might accomplish.

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