Commentary: A bumpy road for electric cars

Israel is seen as an ideal test bed for electric and hybrid vehicles, but the reality is more complicated.

electric car 311 (photo credit: Better Place)
electric car 311
(photo credit: Better Place)
2011 will be “Electric Year” in the Israeli automobile market. Besides the electric car of the Better Place venture, which will start to be sold routinely in the second half of the year, many other electric vehicles, or “almost electric” vehicles – that is, hybrids equipped with large, new-generation rechargeable batteries that can be driven dozens of kilometers on electricity alone – will arrive in Israel.
Among them will be the Chevrolet VOLT, some examples of which will arrive in Israel for premarketing trials; a plug-in version of the veteran Toyota Prius, in which the battery can be charged from the mains to minimize the use of the gasoline engine; and perhaps, toward the end the year, a plug-in vehicle from Chinese manufacturer BYD.
All these vehicles come to Israel “hot from the oven,” and will take to its roads at the same time as, or even before, they hit the roads of Europe. One reason is the image created in recent years of Israel as an ideal test bed for vehicles with alternative propulsion. This image was created partly thanks to the international noise made by Better Place and the declared policy of the State of Israel of encouraging green transportation. A glance at environmental periodicals and websites in India, China, Australia and Canada can create the impression that Israel is a paradise for clean vehicles.
In practice, the Israeli automobile market is far even from coming into line with Europe, and the road to the regular car market for the new vehicles will be bumpy. Here are a couple of reasons why:
The charging problem
All the electric and hybrid cars coming to Israel will at some stage have to connect to a charging outlet connected to the national grid, whether at work or at home. The charger will not be cheap, and it will have to undergo quite a few teething troubles of regulation and installation. Electric cars and second-generation chargeable hybrids have large, expensive and sensitive batteries. Charging them is no trivial matter, and there is a risk of damage or, worse, explosion, if charging is not done carefully, especially if the battery is hot after a long trip.
In short, forget Israeli-style extension cable solutions. Every domestic charging system will have to obtain Israel Electric Corporation approval, and it will cost accordingly. Just try to upgrade the electricity at home to three-phase, and you’ll get a taste of things to come. So far, IEC has not rushed to formulate standards, and apparently there are no plans to subsidize domestic charging adapters.
The tax problem
Israeli “green” taxation policy formulated in recent years tried to create “environmental tax differentiation according to technology.” Fully electric vehicles, defined as “zero emission,” get a full purchase-tax exemption, as do their batteries, which make up a large part of their cost. However, a hybrid car is “penalized” with a 30 percent additional tax, no matter what the size of its gasoline engine.
The question is, how will legislation address the new category of plug-in vehicles? These vehicles reduce average emissions substantially in comparison with regular hybrids, so that, theoretically, they should be zero-emission vehicles most of the time. The gasoline engine only functions as a generator to charge the battery on the road. They suffer from the same drawback as electric vehicles: their battery is big and very costly, putting up the price of the vehicle considerably. However, as noted, in current regulations they are not regarded as “electric vehicles,” so their price will be very high, about NIS 200,000-plus.
In short, the only green effect of the new cars in Israel will be the flow of greenbacks to the Finance Ministry.