Saturday, May 25, 2013

 

Better Place headed for Worse Place


By Henry Curtis

Remember the HECO Press release of December 2, 2008?

"Governor Linda Lingle and Shai Agassi, founder and CEO of Better Place, today unveiled a plan to bring an electric-car network to Hawai‘i, creating a model for the adoption of electric cars in the U.S. The move – only the second of its kind announced in the nation – will help fuel Hawai‘i’s drive to lead the nation in renewable energy use, create jobs locally, while also helping to secure our energy future."

The initial Better Place plan centered around leasing batteries. Customers would bring cars into service stations where the depleted battery would be removed and replaced with a fully recharged battery in a minute or two.

Then Better Place decided they wanted to do more than just focus on battery swapping, they also wanted to be an all-encompassing electric car company, selling charging stations, battery swapping stations and electric vehicles.

In March-April 2011 Better Place installed five charging stations at Sheraton in Waikiki and five at three Hawaiian Electric sites as part of a partnership with  HECO, Kyo-ya Hotels and Starwood Hotels.  Hawaii Renewable Energy Development Venture financed early efforts by Better Place. Federal Stimulus Funds given through DBEDT funded the electric charging stations.

In October 2012 Better Place outed Shai Agassi as CEO.


Then Better Place decided that other markets were more desirable than Hawai`i. In March 2013 Better Place sold its network of electric vehicle charging stations in Hawaii to OpConnect, an Oregon-based firm


Now Better Place  has decided to go bankrupt

"Israeli company runs out of steam due to low demand, having burned through more than $800 million but sold barely 2,000 vehicles." Many of the vehicles were sold to employees.

Ian Lind has a great article on Better Place.

# # #




Comments:

Most of the vehicles were sold to government employees in Hawaii.
Good for them - they were told no but suckered into another bad deal. Unfortunately itʻs our money they casually throw out on their bad thinking.

Larry/ Henry, do you know the names of the legislators that pushed this through? We ought to never let them live it down. I would love to post these idiots/fools on my FB page.

Did this have something to do with a dirty deal by Lingle when she went to Israel to ʻplant a treeʻ?
 


One of Lingles bad decisions, allowing an Israeli company access to Hawaii. How many more Israeli companies gained access?..Ironic a country that occupies Palestine illegally invited to occupied Hawaii!
 


We seem to be suckers for anything high-tech. That's why I suggested a couple of times that the state might employ a "chief technologist" who might review and opine on any project before it passes through the legislature or taxpayer money is spent on it. A technical review would also likely have turned up the defects in the Superferry plan, for example, that the fuel the large vessels needed to burn made the business unprofitable.

I don't know how much, if any, we are in the hole on this. It would be interesting to research. If I recall correctly, the charging stations were not charging for the charges, so to speak, through 2012. The company announced in February it was leaving Hawaii and reducing its world-wide operations to Denmark and Israel. The 77 charging stations were picked up by a company called OpConnect in March.

But Better Place's problems were also political. It was headed by Major General Moshe Kaplinsky, former Deputy Chief of Staff of the IDF. A shareholder is (or was) Israel Corporation. Better Place was reported to be building recharging stations for the IDF's electric troop carriers, and supplied charging stations for the illegal occupied West Bank settlements.

I don't know if it's fair to credit the demise of Better Place even in part to the BDS (Boycott Divest Sanctions) movement, but a BDS website reported:

"The company owns and operates Better Place Israel (BPI), a division which is establishing a system of charging stations for electric vehicles throughout Israel and for Jewish settlers in the occupied West Bank.

The company has been a poster child for efforts to greenwash Israel — presenting it as a haven for environmental technologies — yet it has close ties to Israel’s military and political establishments and its principal officers express an explicitly anti-Muslim and anti-Arab agenda."

Had the company advanced in Hawaii, it could have become the largest target here of a BDS movement simply because of its activities in the West Bank and its connections to the IDF.



 


Wow. That was a mouthful and doesnʻt even scrape the surface.

I have noticed a lot of tech or otherwise companies that submit their grand plans to the legislature only to come back again with excuses why it was a flop and requesting bail out money.

Itʻs the same as if any of us decided to take a template business plan and submit it and donʻt want to spend our own money on a start-up business. But what it turns out to be is just a scam to grab free money from foolish decision makers.
 


If the hyperventilating has taken a pause, let me make a couple points:
- both MOUs (BP and CT&T) were encouraging to the companies, and committed the state to very little beyond the level of support provided to any company, and what statute already provided. Companies like MOUs for executives and investors. Why would the state refuse to sign such an agreement that spells out what the state will already do anyway? On what basis? The state also signed such an agreement with Nissan – now, Hawaii is the Leaf’s best market. Any complaints?
- We could dissect the BP business models (there were several) but having BP invest in Hawaii, and have a presence served the state, and helped raise the state’s profile to other cleantech and EV-related companies. The fact that they were able to sell their network management says that it had value – good on them.
- BP did the best job of executing on stimulus money for a charge network. The state got what it paid for. No, they didn’t put it everywhere (like East Hawaii), but others are planning to extend the network of charge stations. The State of Hawaii likely also has the highest density of charge stations per capita, and BP was a big part of that.
- I find discussions of Zionism related to BP amusing, but not germane. This is pretty much a business deal that failed.
 


Let’s look back a hundred years, and see if that can give perspective.
The practicality of the automobile was initially limited because of the lack of suitable roads. Travel between cities was mostly done by railroad or waterways. Roads were mostly dirt and hard to travel, especially in bad weather. The Federal Aid Road Act of 1916 allocated $75 million (that’s $1.6B in today’s dollars) for building roads (public investment). By 1924 there were 31,000 miles of paved road in the U.S.
Hundreds of auto makers sprung up, and hundreds went bankrupt. Eventually, the Big Three snapped up the rest and became the Big Three. Many of these companies were innovative and made technological or market headway, only to fail for one reason or another.
The result is a new phenomenon of a mobile society. Innovators changed the world, even if they or their investors lost their shirt along the way.
One more thought – remember Global Crossing? When it went bankrupt in 2002, it was the fourth largest in history. It overextended itself and the market for fiber collapsed with the Dot Com bubble. Before it went, however, it laid over 100,000 miles of fiber, building the infrastructure and foundation for the Internet of today. They just couldn’t ride it out, having to sell that network. By the way, they still exist today – and so does their fiber. Chances are, you are reading this after the bits went from my computer to yours over that same fiber.
Innovation is stormy, but continues on and changes the world. “I told you so” reminds me of one of my favorite quotes:
“It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.
- Theodore Roosevelt
Speech at the Sorbonne
Paris, France
April 23, 1910″
 


The CT&T deal was replicated in other cities and states as I wrote at the time. They were all taken in.

Also, one might speculate (as I did) about the company's fondness for the number 10,000 as opposed to anything realistic. Lingle was pictured in one of their golf carts, and the hype was piled higher than a Kakaako skyscraper. The MOU was not worth the ink it was written in.

Yes, BP's charging stations helped the state. No argument. And while the battery swap idea was innovative, it had its critics even then. The company's failure may or may not have had anything to do with Zionism, but due to its management and activities in the illegal West Bank settlements it would have been a prime target, and correctly so. So that consideration cannot be shrugged off. Hawaii's choice to go with Better Place was more than just an MOU, it can't help but be interpreted in the same way as we hold Walmart and GAP responsible for the consequences of sourcing their clothing from Bangladesh death trap factories.

Nissan is not CT&T and not BP. Anything we do with them (assuming it is not too foolish) has no bearing on the need to be realistic about Hawaii's needs and what's best for our future.

As to Hawaii being Leaf's best customer, I didn't know we were responsible for their prosperity in any way. Most likely the future will produce a great variety of choice among electric vehicles just as it does now for gas vehicles. More power to them (sorry) but we should look out for us, and not for Nissan, HECO or others, but for us. Us. Ourselves. We who pay the highest electricity rate in the country. Let's have some MOUs favorable to us for a change.

 

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