FRANKFURT, Germany—The Asian Development Bank (ADB) confirmed on Monday that the $504-million electric tricycle (e-trike) project, which it is financing, has encountered technical issues.
ADB Sustainable Development and Climate Change Department Director Preety M. Bhandari made this pronouncement in a news briefing here on Monday.
The $504-million project involves the supply and delivery of 100,000 units of e-trike. This is part of the ADB-funded Market Transformation through Introduction of Energy-Efficient Electric Vehicles Project.
“There are many issues. It was not only the batteries, it was also in terms of what kind of production capacity could be set up in the Philippines and local procurement,” Bhandari said.
“There is also an issue as to whether the Philippines should be doing more on the transportation or on the energy efficiency side,” she added. In February the Department of Energy (DOE) awarded the contract to supply only 3,000 e-trikes to Japanese firm Uzushio Electric Co. Ltd.
The $504 million-worth project is financed by the ADB and the national government. Manila will set aside $99 million as counterpart fund for the project.
But Bhandari said there are now discussions with the Philippine government, and the project is expected to get “back on track soon.”
Also, the ADB’s country office in the Philippines confirmed that efforts to save the project have progressed.
The Manila-based multilateral development bank extended a loan of $300 million for the project. It will also be financed through a $100-million loan and a $5-million grant from the ADB Clean Technology Fund.
In 2012 the ADB announced that it has approved the $300 million for the “groundbreaking” project that will replace 100,000 gasoline-burning tricycles in the Philippines with clean and energy-efficient electric tricycles.
The ADB noted that about 3.5 million gas-fueled motorcycles and tricycles are currently operating in the Philippines, typically serving as short-distance taxis, with the average tricycle driver earning less than $10 a day. The Manila-based multilateral development bank said e-trike drivers will save upward of $5 a day in fuel costs and increase their income, as it could carry more passengers. E-trike drivers saw their daily incomes more than double during a pilot program in Metro Manila.
The e-trikes, which run on an electric motor and rechargeable lithium-ion battery, will be introduced to Metro Manila and other urban centers across the Philippines under a lease-to-own arrangement.
The ADB said replacing 100,000 gasoline-powered trikes will enable the Philippine government to save more than $100 million a year in avoided fuel imports, while decreasing annual carbon-dioxide emissions by about 260,000 tons.
The DOE said the project will reduce the country’s reliance on foreign oil imports. Fabricating and assembling the tricycles domestically will create up to 10,000 jobs.
In line with the government’s plan to develop a national e-vehicle industry, the project will support the establishment of an e-vehicle parts industry, battery supply chain and charging stations, including five off-grid solar-charging stations.