E-trike deal out soon, ADB says

The Philippines’ e-tricycle (e-trike) program is gaining ground with the contract for the first batch of units to be awarded soon, said Sohail Hasnie, Asian Development Bank (ADB) principal energy specialist for Southeast Asia.

Speaking to reporters on the sidelines of the 3rd Philippine Electric Vehicle Summit 2014, Hasnie said the awarding of the contract for the supply of the first 3,000 e-trike units (out of the total target of 100,000 units) took some time, as the ADB ensured the bidding process was done competitively.

“I think the DOE (Department of Energy) will be awarding the contract in the next couple of weeks,” Hasnie said, saying the ADB had issued the No Objection Letter regarding the bidding for the first contract.

The letter signifies that the ADB has checked the bidding process and found it to have been done in a competitive manner.

For now, Hasnie said, “We are currently working on the details on what will be the recipient of the units. It depends on the local government unit requirements.”

There is also a plan to bid out another supply contract for 12,000 units by year-end, he said.

There are 350 million tricycle units in the Philippines, many of which are polluters and are costly to operate due to high petroleum prices.

The Philippines, which has some 3.5 million tricycles and 3.88 million motorcycles on the road, seeks to curb its dependence on petroleum-based products (which traditional vehicles use).

Under the e-trike project led by ADB and the DOE, the government plans to replace 100,000 fuel-fed tricycle units with energy efficient e-trikes to help reduce the transport sector’s gasoline consumption by 561,000 barrels yearly, reducing 260,000 tons of carbon dioxide emission yearly.

Traditional units are producing more than 10 million tons of carbon dioxide and using nearly $5 billion worth of imported fuel yearly.

The government, through the DOE, is pushing for clean fuel and “green” transportation to address air pollution, which leads to a prevalence of respiratory diseases and low worker productivity due to poor health.

While the government and industry players agree that the e-trike program and the electric vehicle industry as a whole will help create new jobs and put an added dimension to Philippine manufacturing, there is also a concern on what incentives government will actually give investors.

Industry sources have expressed concern that they may not fully enjoy the six years of income tax holidays supposedly accorded electric vehicle investors because the government, through Board of Investments, wants additional conditions satisfied.

Such additional conditions were apparently included in the Investment Priorities Plan (IPP) for 2013, which was issued around the end of that year.

The Manila Electric Co. (Meralco), asked to comment on sales prospects from the electric vehicle industry, said through company SVP for customer retail services Alfredo S. Panlilio via text message that the distribution utility was still studying the costs and benefits of supporting the industry, such as by providing e-charging stations.

“Meralco wants to support and be an enabler of the EV industry. There is constant dialogue—and the EV summit brings all stakeholders together to move the industry forward,” Panlilio said.