Advocates see Evida law easing part of the cost burden
The continuous and steep climb of fuel prices in the country reflects the similar situation across the global market. Before the Russian invasion of Ukraine, oil price hikes were already being driven by surging demands as the pandemic eased its vise-like grip on most of the world’s economies. By the time Russia mobilized its forces to cross the Ukrainian border and NATO sanctions were consequently imposed upon the aggressor, the world’s third biggest oil producer found itself virtually isolated from much of the world’s trading arenas.
And so, for now, this is the steep price we have to literally pay for cutting ourselves off from Russian oil as a matter of principle. While the world is pressing down on Russia’s neck, Russia is choking us back. So, unless OPEC and other big oil producing nations find a way to increase production to ease the widening supply and demand gap that’s driving oil prices to insane levels, we have no recourse but to fasten (or unfasten?) our seatbelts and be very prudent with our trips, or just maybe try out alternative means of mobility more frequently (As for me, I’d be more than satisfied jumping onto the saddle of my bicycle that I retrofitted with an electric drivetrain for nearby trips).
Perhaps, you might be seriously contemplating about finally buying an electric vehicle (EV) to skirt the oil conundrum. But here’s the rub. Ukraine, the second largest country in Europe in terms of land area, holds a significant amount of minerals and metals needed to produce parts for EVs and batteries, as well as for conventional automobiles. It has been estimated that Ukraine may be holding as much as half a million tons of lithium oxide, as well as significant reserves of copper, cobalt and nickel.
And that’s just on the Ukrainian side. Russia, the world’s largest nation in terms of land area, accounts for nearly 14 percent of the world’s mineral production. With these two oil and mineral-rich nations locked in strife, with no letup in the horizon, supplies coming from their side have come to a standstill.
The world is already feeling the pinch in minerals trading. The cost of nickel, a key ingredient in battery production, has skyrocketed. The prices of many other key minerals are seen to follow suit.
So, in view of these developing events in geopolitics and world trade, it does look a lot like going “out of the fire and into the frying pan” for those making the switch from internal combustion engine-powered cars to EVs.
However, if you ask EV advocates, they see the glass (or the charge) half full.
Ferdinand Raquelsantos, chair of Electric Vehicle Association of the Philippines (EVAP) and president of the Electric Vehicles Owners Society (EVOS), says that despite the widespread increase in costs, “Innovation in technology continues to be amazing. Though the cost to produce batteries is hampered by the rising cost of raw materials like nickel and cobalt, this is being augmented by the availability of ease of charging.”
Raquelsantos explained: “The normal standard of charging by plugging your EV to charging stations and the frequency of doing so is relative to the size and capacity of your battery. The more batteries you have, the longer your EV can run. Technology in wireless charging can lessen the specified battery capacity in your EV. Through electromagnetic induction charging, a coil plate is placed on the ground where you park your vehicle. This wireless technique will allow ease and efficient charging and will require less batteries in EVs.”
Sense of urgency
All things considered, would the current oil crisis be reason enough for President Duterte to sign the pending Electric Vehicle Industry Development Act (Evida) into law, and declare it as urgent? EVAP president Edmund Araga weighed in on the matter, saying, “It is still a prerogative of the President to sign the Evida, but with the endorsement of his cabinet members from DOE (Department of Energy), DTI (Department of Trade and Industry) and NEDA (National Economic and Development Authority) to promote EVs as part of initiatives to address concerns on fuel price hikes, he must act on it.”
Araga added: “If they intend to save on dollars and imports of barrels of fuel, EV is the way to go.” Raquelsantos said that the only way Evida wouldn’t become a law was for it to be vetoed by the President. “Evida was endorsed by the Bicameral for the President’s signature within 45 days; otherwise, (beyond that period), it becomes a law. I just hope he doesn’t veto it.”
Raquelsantos believes that no matter how the current geopolitical power play turns out in eastern Europe, the global automotive industry is just about ready for the shift to EVs. “Evida will promote the shift to EVs. We don’t want us to be the dumping ground of ICEs while the rest of the world races to the shift. It’s urgent, so we can immediately craft the implementing rules and regulations (IRR) and establish zero duties and taxes for imports of component parts for completely knocked-down (CKD) assemblies and develop a local value chain which will create local jobs.
“There should also be a tax break for a certain number of years for imported completely built units (CBUs) to spark the market and define the most preferred models for each segment. We also need to promote the use of EVs for heavy trucks. For the last 15 years, we have locally assembled electric jeeps and trikes for public transport which are way ahead of other Asean countries. Evida will greatly reduce the cost to produce these EVs, and make it feasible to replace the old, smoke-belching and noise-polluting jeepneys and tricycles,” Raquelsantos stressed.
Looking at the longer term, the Department of Energy shared its perspective on EVs. Last week, Mario Marasigan, Director IV of the department’s Electric Power Industry Management Bureau and the former Director of DOE’s Renewable Energy Bureau, told this writer that “the entry of EVs will encourage power project developers to invest more, and the same are already included in the Philippine Energy Plan. By 2040, renewable energy is expected to increase up to 50 percent of our energy mix. Meanwhile, we are currently assessing the potential impacts of oil price increases in our electricity rates.”
