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USA: Q&A: Plug-In Leader Discusses Ups and Downs of America’s E.V. Transformation

Ecotality’s innovation chief discusses everything from the issue of sluggish U.S. demand for E.V.’s and how the Solyndra fallout has affected its business.
\It’s been a rough spell for electric cars, with automakers abandoning sales targets amid tepid demand, and Congressional Republicans trying to turn struggling battery and electric-car manufacturers into symbols of failed clean economy policies.

But that hasn’t stopped Ecotality, a maker of charging equipment and the largest single grantee in the Energy Department’s Vehicle Technologies Program, from pressing ahead with plans to install 14,000 electric vehicle charging stations in cities across the country. The company, backed by $115 million in stimulus money, is nearly halfway to that goal. So far, it has put 5,800 chargers in home garages and public parking lots as part of its three-year-old EV Project.

But charging infrastructure is only half the battle; consumer acceptance is the other half. And while the number of charging companies and stations is proliferating—Pike Research forecasts 13,000 chargers by the end of the year and 1.5 million by 2017—there are just about 20,000 all-electric and plug-in cars on U.S. roads.

That may unnerve advocates familiar with America’s late-1990s experiment in electric cars. After earlier models like GM’s EV1, the Ford Ranger EV and Chrysler’s Epic electric minivan failed to win enough buyers, the infrastructure of chargers was deserted. Much of it had been built by Ecotality North America, an Ecotality subsidiary, then called Electric Transportation Engineering Corporation (eTec).

Things are different now, said Don Karner, Ecotality’s chief innovation officer and president of Ecotality North America, in an extensive interview with InsideClimate News.

For one, they’re working to build a recharging network that encourages increased use of electric vehicles.

The company’s $1,200, WiFi-connected “Blink” chargers record and store details on each charge—how long it takes to “fill up” and at what times the stations are used. The chargers report data back to researchers at the DOE’s Idaho National Lab for analysis. Ecotality has collected about 17 million miles of driving data that it says will lead to wiser decisions about where to plant chargers.

The company recently raised $20 million in private investment from Swiss engineering giant ABB. Last month, it was honored by Bloomberg New Energy Finance as one of the nation’s top ten clean energy pioneers. “Through innovation, acquisitions, and strategic partnerships, Ecotality accelerates the market applicability of advanced electric technologies to replace carbon-based fuels,” said the announcement of the award.

InsideClimate News sat down with Karner in New York City in the week of the event to discuss the promises and challenges of Ecotality and the electric vehicle market.

Electric car advocates have had a tough couple of months. Is the image problem with electric cars affecting your business?

Well, I guess I would challenge that there’s an image problem with electric cars. On a month-by-month basis, I don’t think you can judge anything. It’s an election year. The Obama administration has been very supportive of electric transportation, and so that affiliation is going to cause E.V.’s to have a lot of rocks thrown at them.

What’s the good news about the electric vehicle market?

There are 20,000 cars out there that are running on electricity. I think that’s fantastic news. There’s infrastructure being built. There are a lot of companies out there that are competing in this.

The good news for us is that our investors put tens of millions of dollars in to match the federal government’s money in the EV Project because they believe in electric transportation.

Have the “rocks” that have been thrown at electric vehicles caused you to put the brakes on deploying any infrastructure as part of the EV Project?

No, not at all. Our objectives in the EV Project are to gather data, and to understand as best we can how people are going to utilize that infrastructure and utilize their vehicles. And we’re on target.

In Congress, the rock-throwing at electric cars has come in part because of the political fallout from Solyndra. Are you concerned that Congressional Republicans might pull the plug on things like tax credits for electric cars?

Concerned? Sure. If the subsidies go away, will the industry die? No. If the subsidies stay, will the industry be bolstered and develop faster? Yes. So, I think it’s a good use of government funds to help stimulate an industry that can reduce air pollution, increase energy security and provide transportation at lower cost than current gasoline prices.

Has Ecotality come under heightened scrutiny from the media or received more attention because it received funding from the DOE—even though it wasn’t a loan?

Editor’s Note: Under its grant, Ecotality gets reimbursed about 50 cents for every dollar it spends. So far, the company has spent roughly $70 million on the EV Project and received $33 million of its DOE funds. Late last month, prior to this interview, CBS reported that the firm has been under investigation by the Securities and Exchange Commission since 2010 for insider trading. An Ecotality spokesperson told InsideClimate News that the SEC “has stated that the inquiry should not be construed as a determination that violations of the law have occurred.”

Oh, sure. We got the largest vehicle technologies grant from DOE. And that in itself generates a lot of discussion. We’ve answered the questions honestly and fairly the same way every time. And we don’t see any connection in our house or in the DOE’s house.

Do you have any concerns that electric vehicles might not eventually reach the mass adoption that many are hoping for?

No. I don’t have a concern that they will get there. No one has an understanding of when. There are so many factors. If Iran decides to close the Straits of Hormuz and you have 1970-style lines with people waiting to get gasoline, I can guarantee you electric vehicles will be selling like hotcakes. If gas goes down to $2.50 a gallon, it’s probably going to take longer.

Which do I think has the higher probability? I’m not holding my breath for $2.50 gas. And what happens in the Middle East? I don’t know. But I do know that China and India are going to have a tremendous appetite for oil, and that oil will be supplied. But it will raise the price of oil for everybody.

What do you believe is more important—that electric charging infrastructure is deployed, and that will then attract the drivers? Or is it important to get the cars on the road first, and then build infrastructure?

I think it’s a matter of when in that development cycle you’re talking about. There are people out there for whom it doesn’t matter what the price is, whether there’s infrastructure or what the car looks like. If it’s running on electricity, they want it.

We’ll burn through those folks pretty quickly, and then the more mainstream folks are going to want to see that there’s infrastructure. They’ll want to see that this works, that the batteries are not failing, that you can charge. They’ll want to understand the pricing of all that, and they’ll want to see a mature market. That’s what we’re building right now.

So it’s a little bit of both then, right?

Yes. Who buys vehicles today are not the people who are going to buy them in six months, a year or three years from now. How the infrastructure is going to be used today is going to change over time. And what that formula is for someone to make a purchase decision is going to change over time. We’re looking at the market as a very fluid situation.

If the E.V. market does remain in this early adopter segment, can Ecotality continue to build charging infrastructure without that mainstream market?

Well, the infrastructure is going to be built out as required to support the vehicles that are there. And so, if there’s no more vehicles, one would not deploy additional infrastructure. But as I said, I don’t see that as a viable premise.
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