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The Israeli government is sponsoring a campaign to encourage widespread use of electric cars.

Prime Minister Ehud Olmert signed a deal Monday with Renault-Nissan CEO Carlos Ghosn under which the automotive conglomerate will produce electric cars for mass distribution in Israel beginning in 2011.

Project Better Place, a company headed by Israeli venture capitalist Shai Agass, will construct a national grid of thousands of stations where the cars can be recharged.

The signatories said Israel would be a proving ground for turning electric cars into the mass transit of choice in an era of oil jitters and environmental concerns.

According to Olmert, the government hopes to eliminate gasoline-based transportation in Israel by 2020.

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