Shai Agassi, previously heir apparent at SAP, has left two years ago to move as entrepreneur into the business of providing infrastructure for electric cars. An inspiring lecture at MIT world.
Imagine a response to oil dependence and climate change that offers people around the world a new and improved version of the car, premised on redesigning infrastructure top to bottom with green technology in a way that recharges ailing national economies. Applying both an entrepreneurial spirit and a systems engineering approach, Shai Agassi has devised just such a visionary plan for cracking these vexing global challenges.
A recent World Economic Forum asked participants how to make the world a better place by 2020. Agassi felt an engineer’s compulsion to respond. He describes a process “like a fractal problem…opening up a cascade of questions.” First came the notion of running a country without oil. He seized on, then dismissed, the idea of bio- and hydrogen-based fuels. He then experienced the seminal insight that “you need to go down from molecules to electrons if you want to change the world.”
This realization meant addressing both economic and engineering problems. He’d need to offer consumers not a vehicle limited to two seats, three wheels and 28 mph speeds — but one that could go faster than gas cars, with all the requisite bells and whistles. To move his plan along, he also determined to use available electric car battery engineering. This raised significant issues of convenience: where to recharge and how frequently. Agassi envisioned charging docks in parking lots and home garages. He devised a simple battery replacement method.
Then came the issue of affordability, which Agassi solved by applying a familiar business model, though not one associated with cars: cell phone minutes. Sell consumers an electric car with a subscription for miles: the longer the subscription, the greater the discount (or rebate check). In Europe, Agassi notes, where gas costs $7 to $8 a gallon, a five-year subscription pretty much gets you “a free electric car.”
The model’s complexity and infrastructure requirements imply government backing, which Agassi has already secured. In Denmark there’s a 180% tax on gasoline, and gas-powered sedans costs 60 thousand euros while electrics go for 20 thousand. North Sea windmills will provide clean electricity for charge stations. Israel’s building a desert solar field to “drive every car,” and a smart grid to monitor battery charging. The U.S. is hosting pilot programs in Hawaii and the Bay Area.
His is not a plan to phase in gradually: The time is now, he says. “We must do the right, moral thing,” to contend with climate change and brutal oil regimes, and “to create the biggest expansion in U.S. history.”