Why The EV Industry Misjudged Battery Swapping — And How We Can Get It Right This Time – CleanTechnica

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By Lixiong Wu, Founder of Extenergy | Sustainable Energy Systems Architect and EV Innovation Entrepreneur | Holder of U.S. Patent for Modular Battery Swapping Platform

The idea of battery swapping in electric vehicles (EVs) isn’t new. In fact, it has been tested at scale — and failed. Most in the industry remember the case of Better Place, the Israeli startup that raised over $850 million and built nearly 88 battery swap stations before collapsing. Elon Musk himself dismissed swapping as a dead-end, citing Tesla’s own failed pilot. As a result, many professionals in the EV ecosystem have internalized a hard conclusion:

“Battery swapping doesn’t work.”

But what if that conclusion was based on flawed experiments and avoidable missteps? What if the industry has been chasing a suboptimal energy model because of a fundamental misunderstanding?

The Better Place Mistake: Setting Standards Without Consensus

Better Place had vision. But it made one critical error: it created a battery-swapping standard in isolation. The company partnered with Renault to produce a single compatible EV — the Renault Fluence Z.E. — and although they initially planned to deploy up to 100,000 vehicles, in reality, only about 1,000 units were delivered in Israel and around 400 in Denmark.

Meanwhile, Better Place moved forward aggressively with infrastructure: it built approximately 70 battery swap stations across Israel and 18 in Denmark. This heavy capital investment came despite having only one OEM partner and very limited vehicle deployment.

No other automaker joined. And why would they? OEMs will not invest in a platform that locks them into another company’s infrastructure and product strategy.

Better Place was an infrastructure company trying to dictate a vehicle standard — a role that belongs to automakers. It is this misalignment of authority and responsibility that doomed the project from the start.

Battery standardization, if it is to succeed, must be built through collaboration — with mutual respect among automakers. Professional decisions must be made by professionals. It’s not the job of infrastructure startups to dictate vehicle architecture.

And herein lies a key reason why battery swapping hasn’t taken off: no single OEM can generate enough swap demand to support a nationwide network on its own. Without shared standards, the economics simply don’t work. Just like gas stations serve all brands, swapping infrastructure must become a shared utility.

Tesla’s Swap Test: A Flawed Experiment

Tesla’s 2015 battery swap pilot is often cited as proof that consumers don’t want swapping. But the test conditions were far from fair.

The pilot was run at Harris Ranch, California, where Tesla built a single battery swap station. More than 200 Model S owners were invited to try it. Only 4 to 5 users actually did. None returned for a second swap.

This has often been interpreted as consumer rejection of swapping. But context matters:

• Battery swapping cost $60–$80 per session.
• Supercharging was completely free — for life.

Given these incentives, it’s no surprise that nearly all users chose the free option. It wasn’t a meaningful test of preference — just a rational economic response. Had Tesla reversed the pricing model (free swap, paid Supercharging), the results could have been very different.

Tesla didn’t prove that users rejected swapping. They proved that users respond to incentives.

The Core Problem with Fast Charging

While EV adoption remains modest, fast charging can temporarily “cope” with demand. But it is not a grid-friendly or scalable long-term solution.

If we design for peak but live at idle, we end up overbuilding our grid to accommodate devices that rarely run at full power. In the US, fast charging would require ~1 TW peak demand (80% of current 1.25 TW capacity), necessitating trillions in upgrades. Globally, it’s ~6 TW. Chargers sit idle 82% of the time (16–18% utilization), wasting investment.

It creates peak grid stress during the hours of highest human and vehicle activity (50–60% around 6:00 PM).

It requires expensive, high-power equipment exposed to environmental wear (outdoor lifespan 5–10 years, maintenance 5–10% annually).

It forces onboard battery designs to tolerate high C-rate charging, increasing cost, complexity, and thermal risk (shortening life 25%, cycles 1,000–2,000 vs slow charging 1,500–3,000).

This results in a fundamental infrastructure paradox: To prevent grid failure, utilities must provision capacity for peak demand — not average use. But when fast chargers operate below peak (or sit idle), that provisioned capacity goes underutilized. Given that building just 1 gigawatt (GW) of generation capacity can cost $10–15 billion, this underuse represents extraordinary inefficiency and economic waste.

Battery Swapping Solves These Problems — If Built Correctly

A modern battery swapping system, designed collaboratively, offers:

• Off-peak, slow charging in centralized, climate-controlled facilities (US low-valley 283 GW, no expansion needed; global 1.7 TW).
• Grid load smoothing, with no peak surges.
• Higher charger utilization (80–100%), improving ROI (indoor lifespan 10–15 years, maintenance <1%).
• Elimination of fast-charge stress on batteries, enabling safer, denser, cheaper packs (life extended 25%, reducing replacements).

And for users:

• 3-minute energy replenishment.
• Lower vehicle cost (simplification + decoupling saves $14,000–19,000/vehicle; a 1 million-unit automaker saves $14–19 billion annually).
• No range anxiety or long waits.
• No fear of expensive battery replacement, since battery ownership is decoupled.
• Better resale value, thanks to consistently maintained, swappable battery systems.

In the US, swapping needs 130,000 stations ($0.696 trillion total, ~4.2× savings vs $2.9 trillion fast charging). Globally, 780,000 stations ($3.72 trillion vs $17 trillion). It also saves materials (US 1,179 million kg annually, global 7,076 million kg), funds ($113 billion US, $678 billion global), and CO2 (8 million tons US, 50 million tons global). Standardization (2–3 specs) cuts costs 20–30% ($306 billion US savings), and removing the high C-rate curse adds 10–20% ($204 billion US).

Why Standardization Is Now Feasible

The objection often raised is: “We can’t get all OEMs to agree.”

The key logic is this: without enough EV manufacturers participating, there won’t be sufficient swapping demand to support a nationwide network of swap stations. That’s why most OEMs have stayed away. But with our hybrid strategy — deploying limited swap bays at existing gas stations — even a few leading automakers are enough to sustain early operations. The survival of the network in its early phase has already been designed into the model.

This means the system can succeed even with limited OEM participation in the beginning. As the network proves viable, other OEMs will naturally follow — because no one wants to be the last company selling a non-swappable EV when competitors offer:

• Faster replenishment.
• Lower lifetime TCO.
• Higher resale value.

Standardization doesn’t mean excluding others. It means starting with a practical coalition and leaving the door open for more to join.

We can start with just a few leading automakers.

If two to three leading automakers agree to co-develop a shared battery spec (with multiple formats for different classes, like AA/AAA), market dynamics will compel others to follow. No one wants to be the last company selling a non-swappable EV when the competition offers shared benefits.

A Path Forward: Collective Infrastructure, Gradual Transition

To solve the “chicken-and-egg” dilemma of network coverage vs. vehicle compatibility, a gradual transition strategy is key.

By leveraging existing gas station networks, we can start by adding one or two swap bays at key locations. These co-located units:

• Keep capital requirements low.
• Share operating costs with ongoing fuel revenue.
• Preserve employment for station staff transitioning to EV support.

At the same time, EV manufacturers can begin co-designing modular battery standards. Swapping should be treated as a public utility layer — not unlike how charging or fueling is today.

A Call to Reconsider

Battery swapping was not the wrong idea. It was the right idea, done the wrong way.

It’s time to revisit it — not with nostalgia, but with clear engineering, commercial logic, and industry collaboration.

Because if we don’t fix the system now, we may spend the next decade building infrastructure that simply doesn’t scale.

About the Author: Lixiong Wu is the founder of Extenergy and a senior engineer with over 30 years of experience in communications systems, systems integration, and infrastructure planning. He holds a U.S. patent for a modular battery swapping platform and is actively exploring ways to contribute his systems perspective to the ongoing EV transition