France will invest 2.5 billion euros ($3.6 billion) over 10 years in research, subsidies and infrastructure development for electric cars as automakers race to get the vehicles on the road, its energy minister said.
Speaking at a presentation of the government's plans for electric vehicles on Thursday, minister Jean-Louis Borloo said the investment would be split between pilot projects, battery production and bonuses for carmakers building green cars.
The investment would also cover the biggest cost, namely adapting the electricity grid to allow for the creation of a million charging points by 2015 and over 4 million by 2020.
Borloo said around half the charging points would be in private homes, with almost as many in offices, as well as 75,000 back-up charging points in streets and car parks.
Renault (RENA.PA) and PSA Peugeot Citroen (PEUP.PA) are both launching electric cars. Renault's Fluence has a range of 160 km, while PSA Peugeot-Citroen's iOn is based on partner Mitsubishi Motor's (7211.T) iMiev, which has a range of 130 km.
The energy ministry estimates that electric cars could represent 16 percent of new cars by 2020, and 27 percent by 2025.
The risk is to do nothing, like American carmakers, Borloo said.
No player can take the risk alone, and if all the players take the risk at the same time, it will work, Borloo said.
Borloo confirmed that 50,000 electric cars would be ordered in 2010, split between the government, local authorities and partner companies, while 50,000 more orders would be placed in the coming years. ($1=.6863 Euro)
(Reporting by Clement Guillou; Writing by Helen Massy-Beresford; Editing by David Cowell)