Over the past few months there have been an impressive number of announcements about new partners joining Formula E, the single-seater electric racing championship which launches next year. McLaren will make the cars' 300bhp electric motors, Michelin will supply the tyres, watch company TAG Heuer will handle timing, Renault is the technical partner and, as Pitpass' business editor Christian Sylt recently revealed, Williams will provide the batteries. The partners aren't just attracted by the idea of green racing but also by the fact that Formula E swerves around many of the hurdles that prevent progress in Formula One. Its latest fix is revealed in an article by Sylt in American magazine AutoWeek and it is one which F1 has been working on for a long time.

Sylt's article reveals that Formula E will apply a budget cap to teams – an idea which F1 has been toying with for years. In 2009 Max Mosley, when president of the FIA, attempted to introduce a £40m cap to F1 team budgets. At £2.2m (€2.5m), Formula E's budget cap will be far lower and, according to the series' chief executive Alejandro Agag, it is definitely going to be implemented.

"We have a €2.5m cap on the operating budget of the team - anything spent on racing except the car. The chassis is almost spec but not the powertrain. It is not a chassis competition, it is an electric power competition. The manufacturers are calling us and saying we want to meet you so that you can explain to us how we can be part of it."

Agag adds "there are now 18 teams in the pipeline and we are going to announce more before the end of the summer." It is believed that one of the top IndyCar teams will be unveiled as a Formula E entrant along with several based in the UK. Whilst the identity of the IndyCar team is unknown it seems likely that it will be run by either Penske or Ganassi as they are the top names in the series.

So far, two out of the ten Formula E teams have been announced. One will be run by pharmaceuticals entrepreneur Lord Drayson who last month claimed the electric land speed world record. The other will be run by motorsport boss Yu Liu and will be known as China Racing.

Bluebird, another British outfit associated with land speed records, hopes to run its own team and produce Formula E cars. This plan is unlikely to come off in 2014 as the FIA has already homologated the Formula E car for next year. The design which it has agreed on comes from Italian firm Dallara which makes the cars for F1's feeder series GP2 and GP3. The organisers of Formula E will supply Dallara's cars to all of the teams which is another constraint on team costs. There are even more.

Agag says that when additional car manufacturers join the series they will have to support all the teams. "If you want to be a constructor you can spend as much as you want on making the car but you are obliged by the regulations to sell the car to at least two other teams - the chassis, the powertrain and everything."

They are known as customer cars and it is another idea which F1 has been toying with for years. At the moment, each team is required to make its own chassis and any move to change this is usually resisted by one of the outfits. F1's boss Bernie Ecclestone recently revealed to Sylt that he thinks "customer cars would be a good thing but everybody needs to agree to it. Frank Williams is the one who is against it."

Formula E succeeded where F1 failed because it starts with a clean slate. This has allowed Agag to set the terms which teams have to accept if they want to sign up. In contrast, the existing teams have rights in F1 and unanimous agreement is often required to make changes.