Primer on Electric Vehicle Industry Development Act (Republic Act No.11697)

Republic Act No. 11697or the Electric Vehicle Industry Act[1]?lapsed into law on April 15, 2022. The EVIDA is linked to the policy direction of the government in terms of energy efficiency, conservation, sufficiency, and sustainability in the country as declared in Republic Act No. 11285 or the Energy Efficiency and Conservation Act. It aims to counter increasing fuel prices and in reducing the country’s dependence on fossil fuels by advocating for the use of electric vehicles. The law governs "the manufacture, assembly, importation, construction, installation, maintenance, trade and utilization, research and development, and regulation of electric vehicles".

The Department of Energy[2] is the primary agency tasked with the promotion of the adoption of electric vehicles and in the development of charging stations and related equipment in coordination with the Department of Transportation, and in consultation with the local government units and other relevant government agencies.

Comprehensive Roadmap for the Electric Vehicle Industry

The EVIDA outlines the regulatory framework and creates the Comprehensive Roadmap for the Electric Vehicle Industry.[3] The CREVI is a national development plan with four components: (a) EVs and charging stations; (b) Manufacturing; (c) Research and Development; and (d) Human Resources Development. The CREVI sets the timeframe for when industrial and commercial companies, public transport operators, and even government agencies will be required to have fleets consisting of at least 5% EV with the end goal of transitioning these sectors to full-EV fleets. It shall be incorporated in the Philippine Energy Plan and the country’s National Transport Policy.

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Classifications of EVs

The term “Electric Vehicle”[4] is defined as a vehicle with at least one electric drive for vehicle propulsion. On September 20, 2022, the DOE released the EVIDA-Internal Rules and Regulations[5] where it identified four examples of EVs: Battery EVs, Hybrid-EVs, Light EVs, and Plug-in hybrid-EVs.[6]

Battery EVs are those with an electrically propelled vehicle with only a traction battery as power source for vehicle propulsion.

Hybrid-EVs are those with both a rechargeable energy storage system and a fueled power source for propulsion.

Light EVs are those used in micro mobility that provide alternative modes of transportation which include electric scooters, electric bicycles, electric personal transport, and other similar vehicles weighing less than fifty kilograms (50 kgs).

Plug-in hybrid-EVs are hybrid EVs with rechargeable energy storage system that can be charged from an external electric energy source.

The list is non-exclusive and future EVs may be recognized by the DOE, provided that, said EV has at least one electric drive used for propulsion.

?Incentives for EV users

?The EVIDA and the EVIDA-IRR provides the following incentives to EV users:

·??????Exemption from the mandatory number-coding schemes implemented by the Metropolitan Manila Development Authority and local government units;[7]

·??????Priority registration and renewal of registration, and issuance of a special type of vehicle plate with the Land Transportation Office;[8]

·??????A 30% discount for Battery EVs and a 15% discount for hybrid EVs for the motor vehicle user’s charge imposed by the LTO under Republic Act No. 8794 or the Motor Vehicle User’s Charge Act, as well as vehicle registration and inspection fees until April 2030;[9]

·??????Owners of Light EVs are exempt from registration, so long as they are not operated on any public highway;

·??????Expeditious processing by the LTFRB of applications for franchise to operate, including its renewal, for PUV operators that are exclusively utilizing EVs; and

·??????Availment of TESDA Training Programs on EV assembly, use, maintenance, and repair of its employees.

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Section 28 of the EVIDA-IRR in relation to Section 24 of EVIDA provides that the Department of Trade and Industry through the Board of Investments shall recommend an EV incentive strategy to the Fiscal Incentives Review Board (FIRB) for manufacturers, including a provision on future government subsidies for buyers of EVs as is consistent with the CREVI.

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DOE Circular on EV Recognition Guidelines

On May 12, 2023, the DOE issued Department Circular No. DC 2023-05-0012, providing for the “EV Recognition Guidelines.”[10] The Circular shall apply to all road transport vehicle “manufacturers, assemblers, importers, and rebuilders,”[11] for the classification and recognition of road transport EVs with the purpose to harmonize the types of EVs.

All road transport vehicle MARs shall notify the Energy Utilization Management Bureau[12] of the DOE of all claimed EVs and shall submit the following documentary requirements: (a) Notice to DOE through EUMB;[13] and (b) Duly accomplished Specification Form.[14] This Circular requires that applications must be submitted to the EUMB for every EV claimed for sale in the market.

The EUMB shall assess the completeness of the documents. The procedure for the EV Characterization will be for a period of 20 days counted from the date of submission of the documentary requirements.

Once submissions are reviewed and assessed as complete, recognized EVs will be added to the official EV listing/database which shall be the basis for the grant of incentives provided in the EVIDA and the EVIDA-IRR. This Recognized EV List shall be made available to the concerned LGUs, national government agencies, and to the public.

The full text of the EVIDA may be accessed here.

In a statement released last March 2023, the DOE said that it is pushing for an increase in the rollout of EVs in the country to 10% from the original 5% mandated under the EVIDA. Under the short-term period or from 2023 to 2028, DOE said it targets the roll out of 2,454,200 EVs comprising cars, tricycles, motorcycles, and buses plying nationwide while 65,000 EV charging stations will be installed nationwide. Citing data from the Land Transportation Office (LTO), the Electric Vehicle Association of the Philippines said that 13,934 EVs have been sold in the Philippines to date.[15]

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For further information on this topic, you may contact the De Guzman San Diego Mejia Hernandez Law Offices (GSMH Law) by phone (02)85110908 or email ([email protected]). The GSMH Law website can be accessed at www.gsmhlaw.com.

[1] Hereinafter, the “EVIDA.”

[2] Hereinafter, “DOE.”

[3] Hereinafter, “CREVI.” Section 6(a) of EVIDA.

[4] Hereinafter, “EV.”

[5] Hereinafter, “EVIDA-IRR.”

[6] Section 5, Rule II, EVIDA-IRR.

[7] Section 31, EVIDA-IRR.

[8] Hereinafer, “LTO.”

[9] Section 30, EVIDA-IRR.

[10] DOE DC No. DC-2023-05-0012

[11] Hereinafter, collectively called “MARs.”

[12] Hereinafter, “EUMB.”

[13] Access the Notice of Application Form here.

[14] Access the Electric Vehicle Specification Form here.

[15] GMA News Online, DOE eyes to increase electric vehicle rollout beyond mandated 5% of fleet