While electrification of the motor vehicle market should be a long-term goal,
the automobile industry should be focusing in the more immediate term on
popularizing natural gas-based liquid fuel mix options, an energy security
“I think we need to be a little more realistic and
understand the pace of penetration of new technologies, how it really works,”
said Dr. Gal Luft, executive director of the Washington- based Institute for the
Analysis of Global Security (IAGS). “I think the Better Place example is very
instructive to sort of level expectations with realities. We should be very
careful about trying to predict how consumers are going to behave.”
was speaking at a session called “Energy Security through Fuel Choice” on
Wednesday morning, at the second of the three-day Eilat- Eilot Fifth
International Renewable Energy Conference and Exhibition in
Electrification, Luft stressed, will be vital to the long-term
survival of the auto industry, but as the market has thus far reflected in the
case of Better Place, the consumers are not yet prepared to adopt the technology
across the board – as it is “not yet mature” and has “many uncertainties,”
according to Luft. This is not to say, however, that customers should remain
dependent on gasoline in the short term, he explained.
Running a car on a
natural gas-based product would allow a driver to spend the equivalent of $20
per barrel of oil, in comparison with paying the approximately $100 per barrel
of oil price available to them at the moment, according to Luft.
should have this progress toward electrification – it’s very important – and
invest where we need to invest,” he said. “But we should not neglect the
nearterm solutions that allow us to use a $20 a barrel equivalent of fuel today,
tomorrow, next week.”
The best way to accomplish this near-term solution
of readily allowing customers “fuel choice” and breaking the “virtual monopoly”
on fuel is by rapidly introducing natural gas-based fuels in liquid form to the
market, Luft explained.
Such fuels can enter a car in the exact same way
as gasoline, and can include combinations of gasoline with methanol, GTL (Gas to
Liquids) and other products.
“We are a liquid fuel society,” he said.
“There is a near-term solution and there is a longterm solution. And we cannot
sort of sit there and wait for the long-term solution.”
By sitting and
waiting for the long-term solution to pan out without attempting the more
immediate-term fixes, countries like Israel are putting them at geopolitical
security risks, Luft stressed.
“For Israel, if we could advance some
replacement for oil and mainly for transportation, I would sell it even for
nothing – to free the rest of the world from the influence of the holders of
that oil that may be here in the Middle East, and are up against us,” said Itzik
Ben- Israel, director for the National Council for Research and
Israel is completely dependent on oil to run its cars, the
same oil from which its hostile Middle East neighbors derive their power,
according to Ben-Israel.
These geopolitical concerns mentioned by
Ben-Israel, however, are “happening right in front of our eyes while we are
waiting for the utopian solutions of electrification,” Luft warned.
order to push fuel choice forward, Israel should be following the example of the
United States National Security Council, which is encouraging the legislation of
an “open fuel standard,” Luft explained. This simple piece of legislation would
say that an automobile dealer cannot sell a new car in the US if it is certified
to run on gasoline only.
“We don’t tell the auto dealers what technology
to choose, but they have to offer some sort of fuel option to the consumer,”
The cheapest way for car manufacturers to comply to this would
be to offer cars that are flex-fuel and can run on any combination of gasoline
and methanol or ethanol – a measure that US House of Representatives and Senate
members support in a bipartisan manner, according to Luft.
vehicle legislation in the US has been problematic, as the government provides
tax incentives of $7,500 when a customer purchases an electric vehicle – but
only for the first 200,000 units per manufacturer.
A similar rule applies
to cars sold in China and Europe, Luft said. In order to advance the electric
car market, the price of the now very expensive batteries needs to come down
dramatically in order to offset the need for subsidies, he
“The clock is ticking very fast, which is why I think that
from an economic standpoint, anything that does not require subsidy or tax
incentive has a much better chance of winning the political game than things
that rely on having subsidization,” Luft said.
An open fuel standard is
therefore “the most important building block” and should become a global
standard, according to Luft. This standardization, however, cannot start in
Israel as “Israel alone cannot shape the global manufacturing in vehicles,” he
“It happened once in history, and that was Better Place, and I
don’t think it panned out too well,” Luft continued. “I don’t think that any
auto-maker will build a car for the Israeli market any time soon after the
Better Place experience. We have to go through the two big markets – the Chinese
market and the US market.”
If the US and China encourage methanol use,
only then will this fuel be able to truly take off in Israel and elsewhere, he
“I’m second to none in the support of electrification, but
it’s important to understand the difficulties here.”