A battery of efforts

Gov’t, private groups to tap PH’s vast nickel reserves in hopes of mitigating EV parts price spikes

No doubt about it. In this chaotic transition where the pandemic is easing up, and in its place an eastern European conflict is tightening its grip on global economies, we’ve found ourselves caught between a rock and a hard place. On one hand, fossil fuel prices are rocketing to new highs. On the other, alternative energy is threatened with supply disruptions from two of the most mineral and metals-rich nations in the grip of war. We dread going to the gas pumps as much as we’re averse to buying electric vehicles (EVs) that, expensive as they are right now, are poised to be even more price prohibitive.

A number of industry experts are stressing that automakers and investors will have to rethink their EV plans if supplies of raw materials—particularly for battery production—continue to be constrained by the Russia-Ukraine conflict. The price of nickel, for instance, has surged. Nickel is a critical ingredient in the production of lithium-ion batteries used in most EVs, and Russia is a leading global supplier of this metal. Ukraine, on the other hand, is a major producer of wire harnesses—cables and connectors that power many cars’ electrical systems—according to Financial Times columnist Brooke Masters.

The picture being painted here looks bleak from both ends of the energy spectrum, but not entirely hopeless. Government has, quite literally, dug up something to help keep the local EV industry afloat and moving forward.

As it turns out, nickel is quite abundant here, with the country being one of the world’s top producers. Now, a battery of efforts is being exerted among the Electric Vehicle Association of the Philippines (EVAP), the Department of Energy (DOE), the Philippine Nickel Industry Association (PNIA), and the Department of Science and Technology’s Philippine Council for Industry, Energy, and Emerging Technology Research and Development (DOST-PCIEERD) to further develop this inherent advantage.

Patrick Aquino, DOE Director for Energy Utilization Management Bureau, told this writer on March 14: “We are closely monitoring the developments brought about by the Russia-Ukraine conflict. There indeed is a strain in raw materials needed for a lot of products, including those needed for EVs. As our country has reserves of nickel, part of the emerging strategy is to enhance its role to meet our domestic requirements.”

Aquino disclosed that in 2021, the Bureau of Investments approved funding for a domestic producer of EV fast chargers and retrofit kits under the Innovation Driver category of the Investments Priorities Plan (IPP).

“We can confirm that the DOST-PCIEERD is actively working on a public compendium of homegrown technologies that are ready for adoption and commercialization in fostering inclusive innovation and sustained industrialization. EVAP continues to be a key partner for the private and public discourse towards the accelerated shift to EVs in the country. EVAP also serves as a bridge with other stakeholders,” Aquino added.

PNIA President lawyer Dante R. Bravo sent a statement to this writer promoting local EV battery production: “PNIA signed a memorandum of understanding (MOU) with EVAP in 2019 to explore possible collaboration to deepen the country’s nickel industry’s role in the global EV battery supply chain. It also signed an MOU in 2019 with the Power Battery Application Committee of China Industrial Association of Power Sources (CIAPS-PBA) for possible joint ventures and investments in the future as there are various achievable collaborations that may be done between our parties to benefit the economies of both countries,” Bravo said.

In addition, Bravo disclosed that “PNIA initiated partnership discussions with DENR and DTI to develop an industry roadmap for the nickel mining sector, given the growing global demand for nickel. Unfortunately, due to the pandemic, the momentum of these efforts slowed down. PNIA is poised to restart discussions this year with key players, particularly the EV industry, and most especially government agencies including Neda, DTI, DOST, and DENR.”

He stressed, however, that EV battery production “requires setting up an entire industry value chain, which needs the collective effort of key stakeholders, especially the government. Like any industry development effort, we need to create a conducive policy and fiscal regime to attract the right investment to enable local EV battery production.”

Ferdinand Raquelsantos, EVAP chair, disclosed, “DOE is coordinating with EVAP and partnering with the PNIA for a plan to invite investors to produce Ni-Cad (nickel-cadmium) batteries in the Philippines. I believe a US company is already putting up a facility here. Obviously, this will make the cost of batteries cheaper.”

Wire harnesses for EVs can also be manufactured here, according to EVAP president Edmund Araga, citing the Yazaki Torres facilities.

The EV industry is still in its startup stage in the country, and Araga stresses that there’s still “a long way to go”.

And with the walls closing in on us hapless consumers of energy that’s getting more and more expensive, there is an urgent need to speed things up in the development of our alternative energy industries. The Electric Vehicle Industry Development Act (Evida), which will be signed into law any day now, is seen to do just that for the mobility sector.