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Business

Green e-transport ecosystem

BIZLINKS - Rey Gamboa - The Philippine Star

As the campaign by government to get back to normal living intensifies, more new public utility buses and jeepneys under the Department of Transportation’s (DOTr) Public Utility Vehicles Modernization Program (PUVMP) are being acquired not only in Metro Manila, but also in other regions.

The DOTr continues to work hard to ensure that local governments continue to support the process of identifying routes that the modern fleets can ply, and in effect, encourage more transport groups to subscribe to the program.

The PUVMP, which was launched by the DOTr in 2017, intends to replace PUVs that have engines that are 15 years or older with new, safer, and environmentally friendly vehicles that are at least Euro 4-compliant or has an electric engine.

While the program was expected to be completed by 2020, protests mainly by affected jeepney drivers and operators, as well as bureaucratic delays aggravated by the pandemic, have continued to pose significant delays to its full implementation. Still, even under the new administration, the DOTr apparently is striving to push for full program implementation.

The assigned government banks – Land Bank of the Philippines and the Development Bank of the Philippines – are all hands on deck trying to process loan applications as quickly as possible, but without exposing the funds made available by Congress to undue risks.

The newly purchased vehicles are expected to be fully amortized in seven years, although it should be interesting to see how the earlier loans secured in the early years pre-pandemic fared, whether amortizations have been religiously paid pre-pandemic or how the transport cooperatives that purchased the new vehicles have managed to survive during the pandemic.

Electric vs ICE

While the PUVMP gives participants a choice of using electric engines instead of internal combustion engines, the former has not always been a first choice because of the limitations that come with juicing or fast-charging vehicle batteries.

With the recent passage of the Electric Vehicle Industry Development Act (EVIDA), however, renewed attention on electric-powered vehicles or EVs for PUV use is driving more inquiries. Likewise, the prolonged high cost of diesel, which is the fuel of choice for jeepneys or buses with ICEs, has been a contributing factor.

EVIDA carries provisions mandating more service stations to put up battery charging or fast-charging plug-in consoles to service what is expected to be a significant rise of electric vehicle (EV) population in the country in the next few years.

The new law will complement a number of local government’s goals of going green, and although most of the electricity that will be used to charge up EVs is still coming from fossils like coal or fuel oil, emissions from these green transportation modes will drop to zero.

Emissions from vehicles running on ICEs account for almost a third of harmful carbon dioxide (CO2) found in the atmosphere. The high levels of CO2 in the environment is closely linked to the current global warming that has spawned serious droughts in China, Africa, and Europe, and unprecedented flooding in Middle Eastern countries.

Sustainable green approach

Going 100-percent green is an aspiration of an increasing number of government planners overseeing public transportation, which means not only in replacing ICEs with electric engines, but also getting electricity sources to be fully sourced from renewable energies.

While this holistic view would be something that would take time to fully be integrated in the local public transportation network, a few attempts are being pioneered by the private sector to fully integrate a sustainable energy source approach into EV adoption for PUVs.

Of particular relevance is a simulation run being initiated by Rafael “Raffy” Villavicencio, son of Chito Villavicencio, who is known for having pioneered the establishment of one of the country’s leading independent oil companies today.

Raffy is keen on promoting and incentivizing a shift to green energy generation for the usage and operation of e-transport. In particular, he is heavily involved in putting up solar panels at a service station where a number of EVs under the PUVMP are operating.

The charging fee at this service station is available at a much lower rate if compared to the cost of using diesel in an ICE-run jeepney or bus, even before prices went berserk. According to Raffy, this paves the way of a more viable operational and financial operation of electric PUVs.

The younger Villavicencio plans to work with nine other service stations to expand the number of green routes where PUVMP participants are found. The ecosystem that is being created will not only help reduce carbon emissions that contribute to global warming, but also reduce pollution brought about by emissions from diesel-fired engines.

Villavicencio says that the whole system will be a first in the country, pioneering a holistic end-to-end renewable energy program tied with networks of gasoline stations. The partnerships in the venture will also address the increasing demand for electric transportation and the franchising of green routes, renewable energy generation, energy storage, charging stations, and the availability of spare parts and maintenance centers.

The generous incentives made available by EVIDA, as well as the Corporate Recovery and Tax Incentives to Enterprises Act (CREATE) and the Tax Reform for Acceleration and Inclusion Law (TRAIN), should reduce the cost of EV acquisition further, and together with savings on charging costs using solar energy, should bring down the amortization period to five years or even less.

It’s still early days of EVs and the development of a workable and sustainable ecosystem, but such pioneering initiatives by well-meaning individuals should give the government’s intentions to encourage a shift of electric vehicles a big push.

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We are actively using two social networking websites to reach out more often and even interact with and engage our readers, friends and colleagues in the various areas of interest that I tackle in my column. Please like us on www.facebook.com/ReyGamboa and follow us on www.twitter.com/ReyGamboa.

Should you wish to share any insights, write me at Link Edge, 25th Floor, 139 Corporate Center, Valero Street, Salcedo Village, 1227 Makati City. Or e-mail me at [email protected]. For a compilation of previous articles, visit www.BizlinksPhilippines.net.

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