Evidence of meeting #46 for Transport, Infrastructure and Communities in the 41st Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was bombardier.
A recording is available from Parliament.
Conservative
Pierre Poilievre Conservative Nepean—Carleton, ON
Have there been any tax incentives or tax credits or preferences that have made it more affordable?
Vice-President, North America, Better Place
Yes, there is a general tax preference based on the carbon intensity. Based on your miles per litre, there's a different tax duty on vehicles, going from 10%—or for electric, 0%—all the way to 70% or 80% for the dirtiest diesel vehicles.
Conservative
Pierre Poilievre Conservative Nepean—Carleton, ON
Okay.
What percentage of Israeli vehicles is now electric?
Vice-President, North America, Better Place
It's only this year that the network opened, so it's still a fairly small number. There are somewhere close to 1,000 being driven right now. But when you look at it from a percentage penetration standpoint, it's more than ten times the level of the most advanced markets, such as the U.S., in terms of new vehicle sales percentage. In the U.S., we're at about 0.3% after two years. In Israel this one model is hitting more than 2% to 3% in the last few months.
Conservative
Pierre Poilievre Conservative Nepean—Carleton, ON
Of new car sales, how many are electric these days?
Vice-President, North America, Better Place
If you look at Israel, you're talking about 50 to 150 in a given month. But Israel itself has fewer than half the number of cars in the greater Toronto area, for instance.
Conservative
Pierre Poilievre Conservative Nepean—Carleton, ON
I understand. But what percentage of new car sales in Israel are of electric vehicles? Do you know?
Conservative
Pierre Poilievre Conservative Nepean—Carleton, ON
Okay.
Who owns the network of battery exchange stations?
Vice-President, North America, Better Place
The entire network is privately owned by Better Place. We have 38 battery substations across the country and thousands of level 2 charging stations at people's houses and in the public domain.
Conservative
October 16th, 2012 / 12:40 p.m.
Conservative
Pierre Poilievre Conservative Nepean—Carleton, ON
Are you turning a profit on your operation in Israel on this network?
Vice-President, North America, Better Place
It's a little early to turn a profit. As an infrastructure play, there was a heavy investment in the infrastructure.
If you look at each one of our miles or kilometres, we're selling at the equivalent of 15¢ or 14¢ a kilometre to consumers. We make a gross margin profit on each one of those kilometres.
We've driven over one million kilometres in the last month. Since we launched six months ago, it has gone from 100,000 to months of 200,000 or 300,000 to, last month, more than one million kilometres driven 100% on electricity. Of course, the numbers are still small, but once you have the network in place, the incremental investment is small and the number of kilometres being bought is very large.
Conservative
Pierre Poilievre Conservative Nepean—Carleton, ON
That's terrific.
Do you have any advice on how your early-stage success could be replicated elsewhere, other than in Israel?
Vice-President, North America, Better Place
I look at California as a better example for Canada than Israel, because everybody says Israel is really a very small country.
People mention that the first thing is leadership. In California, the governor set out an executive order saying that he wants 1.5 million zero-emission vehicles—it doesn't matter whether they're from Better Place or whatever car manufacturer—by 2025. He wants the agencies to take a look at their procurement processes so that they can be the first, not the last, to buy.
He also said, let's look at the structural elements of an industry, because we know that the world is going to electrification.
The point the gentleman from Bombardier made is that California saw this as an opportunity to jump on locally renewable energy, local manufacturing. Some of the newest companies, such as Tesla and battery companies, are being established in California. A lot of it is due not only to incentives, but really to leadership that says that we in California are going to be the model for the world. It will probably take longer than Israel or Denmark, but it's a very good example to follow.
Conservative
Conservative
Pierre Poilievre Conservative Nepean—Carleton, ON
Right. So you have a built-in, natural financial incentive to go to electrification that we don't have yet.
Vice-President, North America, Better Place
Absolutely. That's exactly why our investors would put that $750 million into countries in Europe. Canada falls quite down the line, and the U.S. is even lower.
Conservative
Conservative
Ed Holder Conservative London West, ON
Thank you.
I want to carry on with that a little bit. I was going to ask that question. Most of our questions have been about rail, but what do you think the price point of petrol has to be to provide the incentive to move to an electric system, Mr. Wolf?
Vice-President, North America, Better Place
That's a great question. This is how we calculate our business and how we make our financial decisions.
We can sell an equivalent of a litre at about 85¢ to 90¢; that's a three-and-a-half-dollar gallon. That's the point at which we know we can turn a profit. Of course, the fixed cost of putting in the infrastructure comes into play, so we're going to the markets that have the highest price per litre first.
Then there are other considerations, of size and other things that the U.S. and Canada have.
Conservative
Ed Holder Conservative London West, ON
But you do two things: you provide electric charging at someone's home, I heard you say, and you also do battery replacement.
When does the battery replacement come in? Do you go into some place like a Canadian Tire, if you know that store, and say, “I'll have a new battery, please”? Your company is the Canadian Tire equivalent, so do you own those batteries, or do you just swap them out and pop the next one in? Is that how it works?
Vice-President, North America, Better Place
Yes, but it's much more high-tech, and quicker than in the Canadian Tire example. Technically, we could partner with Canadian Tire and put these stations in those places. The key is that in less than five minutes, end to end, you have another 100 miles.
What happens is that you come in to your dealership, you buy your car, as you do a mobile phone, you sign up for the kilometres, and then someone comes to your house and puts in a charging station that fits in with your electrical grid, and that thing fills your car whenever you're sleeping or whenever you're parking.
On the exceptional trip—let's say you want to drive from Toronto to Ottawa—you would then switch your battery once or twice, depending on the length of your trip, and you'd be able to make any type of trip. Once you get to Parliament or to your local destination, you would probably have a regular charger that trickles electricity in a more efficient way.
So the switch is the one that allows the industry to...you couldn't do it without the switch, but it's not the only component. About 70% to 80% of the energy actually comes in at home or at places where the car rests.
