Arcimoto, Inc. — Hazardous Materials Safety Interpretation

Page 1U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration June 10, 2021 1200 New Jersey Avenue, SE Washington, DC 20590 Mr. Pete Z Director of Global Regulatory Compliance Arcimoto, Inc. 2034 W 2nd Ave Eugene, OR 97402-7105 Reference No. 21-0050 Dear Mr. Z: This is in response to your May 6, 2021, email requesting clarification of the Hazardous Materials Regulations (HMR; 49 CFR Parts 171-180) applicable to lithium batteries in electric vehicles. Your questions are paraphrased and answered as follows: Q1: You ask whether a lithium ion battery contained in an electric vehicle and securely fastened to the battery holder must comply with all of the requirements in § 173.185. A1: An electric vehicle powered by a lithium-ion battery that is transported with the battery installed should be classed as “UN3171, Battery-powered vehicle, 9” and offered for transportation and transported in accordance with § 173.220 of the HMR. A battery in an electric vehicle shipped in accordance with § 173.220 must be: (1) securely fastened in its holder/compartment; (2) protected in such a manner as to prevent damage and short circuits; and (3) of a type that successfully passed tests in the United Nations (UN) Manual of Tests and Criteria as specified in § 173.185. Q2: You ask whether a lithium ion battery—one that is removed from an electric vehicle and packed separately from the vehicle—must comply with the requirements in § 173.185. A2: When a lithium-ion battery is removed from an electric vehicle and packed separately, the battery must be shipped as “UN3480, Lithium ion batteries, 9” and prepared in accordance with the applicable requirements specified in § 173.185. I hope this information is helpful. Please contact us if we can be of further assistance. Sincerely, T. Glenn Foster Chief, Regulatory Review and Reinvention Branch Standards and Rulemaking Division#

Page 2Andrews 21-0050 From: DerKinderen, Dirk (PHMSA) To: Hazmat Interps Subject: FW: Arcimoto -- 49 CFR § 173.185 -- Request PHMSA Office of Chief Counsel guidance Date: Monday, May 10, 2021 11:03:55 AM Attachments: image004.png Interp request forwarded from counsel. Thanks, Dirk Der Kinderen Chief, Standards Development Branch PHMSA 202-366-4460 From: Horsley, Adam (PHMSA) Sent: Monday, May 10, 2021 11:00 AM To: DerKinderen, Dirk (PHMSA) <Dirk.DerKinderen@dot.gov> Cc: Tsaganos, Vasiliki (PHMSA) <vasiliki.tsaganos@dot.gov>; Tackett, Christina (PHMSA) <christina.tackett@dot.gov>; Ross, Robert (PHMSA) <robert.ross@dot.gov> Subject: FW: Arcimoto -- 49 CFR § 173.185 -- Request PHMSA Office of Chief Counsel guidance Hi Dirk, Thanks, - Adam Can you please treat the questions below as a request for an interpretation? Adam Horsley Deputy Assistant Chief Counsel, Office of Chief Counsel US Department of Transportation Pipeline and Hazardous Materials Safety Administration 1200 New Jersey Avenue, S.E., Washington, D.C. 20590 Office: 202.366.8000 ◊ Facsimile: 202.366.7041 PHMSA Home | LinkedIn | Twitter | HAZMAT | OPS PRIVILEGED & CONFIDENTIAL: This e-mail, including any attachments, is confidential, intended only for the named recipient(s) above and may contain information that is privileged, confidential, attorney work product or otherwise legally protected. If you have received this message in error, or are not the named recipient(s), please immediately notify me and permanently delete this e-mail message and any attachments from your workstation and/or network mail system. From: Pete Z [mailto:petez@arcimoto.com] Sent: Thursday, May 6, 2021 7:35 PM To: Chief Counsel, PHMSA (PHMSA) <phmsachiefcounsel@dot.gov> Cc: Regulatory Affairs <regulatory@arcimoto.com>; Gerrit Hurenkamp <gerrith@arcimoto.com> Subject: Arcimoto -- 49 CFR § 173.185 -- Request PHMSA Office of Chief Counsel guidance#

Page 3CAUTION: This email originated from outside of the Department of Transportation (DOT). Do not click on links or open attachments unless you recognize the sender and know the content is safe. Hello PHMA Chief Counsel, Thanks for speaking with me earlier today! I'm doing some research to confirm or reject that fully battery-electric motor vehicles (EV) will need to comply with 49 CFR § 173.185. Here's my research so far: PHMSA's Interim Final Rule (IFR) became effective on March 6, 2019, see attached PDF "FedReg PHMSA 49 CFR 172-173 HazMat Enhanced Safety Li-ion 2019_03_06" Test summaries of demonstrated compliance are required starting Jan 1, 2022, see attached PDF "FedReg PHMSA 49 CFR 171-180 HazMat Harmonization With Intl Stds 2020_05_11" EV batteries are typically shipped contained within new vehicles, but also shipped separately to repair partners for service, warranty, and part sales. UNECE Transport of Dangerous Goods regulations for ground, air, & marine transport, such as UN 38.3 is relevant, and was "harmonized" by above PHMSA regulations. Typical EV battery-packs are 20,000+ Watt-hours and weigh hundreds of pounds. For some EV, each battery contains cells or a series of cells that are connected in parallel, all battery control mechanisms like BMS, contactors, major fuses, etc are external to the batteries, and there are no means inside the battery of preventing reverse current flow. Per 173.185(a)(3), “Beginning January 1, 2022 each manufacturer and subsequent distributor of lithium cells or batteries manufactured on or after January 1, 2008, must make available a test summary.” The test summary requirements are listed 173.185(a) (3)(i) to (x). Per 173.185(a)(4), there is no stated phase-in date, so it appears that for subject cells and batteries, “each lithium cell or battery must: (i) Incorporate a safety venting device or be designed to preclude a violent rupture, (ii) Be equipped with means of preventing external short circuits; and (iii) Be equipped with a means of preventing dangerous reverse current flow (e.g., diodes or fuses) if a battery contains cells, or a series of cells that are connected in parallel.” Per 173.185(c) and (c)(1), “smaller cells or batteries” may be exempt if the “Size limits” is met where “The Watt-hour (Wh) rating may not exceed 20 Wh for a lithium ion cell or 100 Wh for a lithium ion battery.” Per 173.185(c)(1), “After December 31, 2015, each lithium ion battery subject to this provision must be marked with the Watt-hour rating on the outside case.” Per 173.220(d), "Where the lithium battery is removed from the vehicle and is packed separate from the vehicle in the same outer packaging, the package must be consigned as “UN 3481, Lithium ion batteries packed with equipment” or “UN 3091, Lithium metal batteries packed with equipment” and prepared in accordance with the requirements specified in §173.185." I've completed an iSearch.NHTSA.gov review, found three letters from NHTSA Chief Counsel that are relevant to PHMSA 173.185, please see attached PDF. Questions for PHMSA:#

Page 4If a Li-ion battery is intended for a motor vehicle and is not "smaller," then is compliance to 49 CFR 173.185 required for either or both of the following conditions? 1. Where the Li-ion battery is contained in the vehicle and securely fastened in the battery holder of the vehicle; 2. Where the Li-ion battery is removed from the vehicle and is packed separate from the vehicle. If PHMSA has already provided guidance to other EV motor vehicle OEM (such as Ford, GM, Toyota, etc) in response to same/ similar questions, then can you share this guidance with me so we don't unnecessarily cover the same ground? I look forward to speaking with you at your very earliest convenience. Please feel free to call me anytime. Thank you, Pete Z Director of Global Regulatory Compliance Arcimoto, Inc. mobile 541-846-8198#

Page 5Andrews 21-0050 From: DerKinderen, Dirk (PHMSA) To: Hazmat Interps Subject: FW: Arcimoto -- 49 CFR § 173.185 -- Request PHMSA Office of Chief Counsel guidance Date: Monday, May 10, 2021 11:03:55 AM Attachments: image004.png Interp request forwarded from counsel. Thanks, Dirk Der Kinderen Chief, Standards Development Branch PHMSA 202-366-4460 From: Horsley, Adam (PHMSA) Sent: Monday, May 10, 2021 11:00 AM To: DerKinderen, Dirk (PHMSA) <Dirk.DerKinderen@dot.gov> Cc: Tsaganos, Vasiliki (PHMSA) <vasiliki.tsaganos@dot.gov>; Tackett, Christina (PHMSA) <christina.tackett@dot.gov>; Ross, Robert (PHMSA) <robert.ross@dot.gov> Subject: FW: Arcimoto -- 49 CFR § 173.185 -- Request PHMSA Office of Chief Counsel guidance Hi Dirk, Thanks, - Adam Can you please treat the questions below as a request for an interpretation? Adam Horsley Deputy Assistant Chief Counsel, Office of Chief Counsel US Department of Transportation Pipeline and Hazardous Materials Safety Administration 1200 New Jersey Avenue, S.E., Washington, D.C. 20590 Office: 202.366.8000 ◊ Facsimile: 202.366.7041 PHMSA Home | LinkedIn | Twitter | HAZMAT | OPS PRIVILEGED & CONFIDENTIAL: This e-mail, including any attachments, is confidential, intended only for the named recipient(s) above and may contain information that is privileged, confidential, attorney work product or otherwise legally protected. If you have received this message in error, or are not the named recipient(s), please immediately notify me and permanently delete this e-mail message and any attachments from your workstation and/or network mail system. From: Pete Z [mailto:petez@arcimoto.com] Sent: Thursday, May 6, 2021 7:35 PM To: Chief Counsel, PHMSA (PHMSA) <phmsachiefcounsel@dot.gov> Cc: Regulatory Affairs <regulatory@arcimoto.com>; Gerrit Hurenkamp <gerrith@arcimoto.com> Subject: Arcimoto -- 49 CFR § 173.185 -- Request PHMSA Office of Chief Counsel guidance#

Page 6CAUTION: This email originated from outside of the Department of Transportation (DOT). Do not click on links or open attachments unless you recognize the sender and know the content is safe. Hello PHMA Chief Counsel, Thanks for speaking with me earlier today! I'm doing some research to confirm or reject that fully battery-electric motor vehicles (EV) will need to comply with 49 CFR § 173.185. Here's my research so far: PHMSA's Interim Final Rule (IFR) became effective on March 6, 2019, see attached PDF "FedReg PHMSA 49 CFR 172-173 HazMat Enhanced Safety Li-ion 2019_03_06" Test summaries of demonstrated compliance are required starting Jan 1, 2022, see attached PDF "FedReg PHMSA 49 CFR 171-180 HazMat Harmonization With Intl Stds 2020_05_11" EV batteries are typically shipped contained within new vehicles, but also shipped separately to repair partners for service, warranty, and part sales. UNECE Transport of Dangerous Goods regulations for ground, air, & marine transport, such as UN 38.3 is relevant, and was "harmonized" by above PHMSA regulations. Typical EV battery-packs are 20,000+ Watt-hours and weigh hundreds of pounds. For some EV, each battery contains cells or a series of cells that are connected in parallel, all battery control mechanisms like BMS, contactors, major fuses, etc are external to the batteries, and there are no means inside the battery of preventing reverse current flow. Per 173.185(a)(3), “Beginning January 1, 2022 each manufacturer and subsequent distributor of lithium cells or batteries manufactured on or after January 1, 2008, must make available a test summary.” The test summary requirements are listed 173.185(a) (3)(i) to (x). Per 173.185(a)(4), there is no stated phase-in date, so it appears that for subject cells and batteries, “each lithium cell or battery must: (i) Incorporate a safety venting device or be designed to preclude a violent rupture, (ii) Be equipped with means of preventing external short circuits; and (iii) Be equipped with a means of preventing dangerous reverse current flow (e.g., diodes or fuses) if a battery contains cells, or a series of cells that are connected in parallel.” Per 173.185(c) and (c)(1), “smaller cells or batteries” may be exempt if the “Size limits” is met where “The Watt-hour (Wh) rating may not exceed 20 Wh for a lithium ion cell or 100 Wh for a lithium ion battery.” Per 173.185(c)(1), “After December 31, 2015, each lithium ion battery subject to this provision must be marked with the Watt-hour rating on the outside case.” Per 173.220(d), "Where the lithium battery is removed from the vehicle and is packed separate from the vehicle in the same outer packaging, the package must be consigned as “UN 3481, Lithium ion batteries packed with equipment” or “UN 3091, Lithium metal batteries packed with equipment” and prepared in accordance with the requirements specified in §173.185." I've completed an iSearch.NHTSA.gov review, found three letters from NHTSA Chief Counsel that are relevant to PHMSA 173.185, please see attached PDF. Questions for PHMSA:#

Page 7If a Li-ion battery is intended for a motor vehicle and is not "smaller," then is compliance to 49 CFR 173.185 required for either or both of the following conditions? 1. Where the Li-ion battery is contained in the vehicle and securely fastened in the battery holder of the vehicle; 2. Where the Li-ion battery is removed from the vehicle and is packed separate from the vehicle. If PHMSA has already provided guidance to other EV motor vehicle OEM (such as Ford, GM, Toyota, etc) in response to same/ similar questions, then can you share this guidance with me so we don't unnecessarily cover the same ground? I look forward to speaking with you at your very earliest convenience. Please feel free to call me anytime. Thank you, Pete Z Director of Global Regulatory Compliance Arcimoto, Inc. mobile 541-846-8198#

Page 8Andrews 21-0050a From: DerKinderen, Dirk (PHMSA) To: Dodd, Alice (PHMSA) Subject: FW: Arcimoto -- 49 CFR § 173.185 -- Request PHMSA Office of Chief Counsel guidance Date: Tuesday, May 11, 2021 11:12:52 AM Attachments: FedReg PHMSA 49 CFR 172-173 HazMat Enhanced Safety Li-ion 2019_03_06.pdf FedReg PHMSA 49 CFR 171-180 HazMat Harmonization With Intl Stds 2020_05_11.pdf iSearch.NHTSA.gov - Letter from NHTSA DD.Kinderen to DHL DRV.Franco - 2020_09_15.pdf iSearch.NHTSA.gov - Letter from NHTSA TG.Foster to TerraTrike L.Permesang - 2020_05_06.pdf iSearch.NHTSA.gov - Letter from NHTSA DD.Kinderen to Honda PowerEquip S.Gregory - 2017_11_01.pdf FYI….for sharing with whomever this letter got assigned to. Thanks, Dirk Der Kinderen Chief, Standards Development Branch PHMSA 202-366-4460 From: Tsaganos, Vasiliki (PHMSA) On Behalf Of Chief Counsel, PHMSA (PHMSA) Sent: Tuesday, May 11, 2021 11:09 AM To: DerKinderen, Dirk (PHMSA) <Dirk.DerKinderen@dot.gov> Cc: Horsley, Adam (PHMSA) <adam.horsley@dot.gov> Subject: FW: Arcimoto -- 49 CFR § 173.185 -- Request PHMSA Office of Chief Counsel guidance Dirk: Adam confirmed you are logging this in. Just want to make sure you have all the attachments. Many thanks! Vasiliki Tsaganos Deputy Chief Counsel, Office of Chief Counsel US Department of Transportation Pipeline and Hazardous Materials Safety Administration 1200 New Jersey Avenue, S.E., Washington, D.C. 20590 Office: 202.366.0639 ◊ Facsimile: 202.578.9223 PHMSA Home | LinkedIn | Twitter | HAZMAT | OPS PRIVILEGED & CONFIDENTIAL: This e-mail, including any attachments, is confidential, intended only for the named recipient(s) above and may contain information that is privileged, confidential, attorney work product or otherwise legally protected. If you have received this message in error, or are not the named recipient(s), please immediately notify me and permanently delete this e-mail message and any attachments from your workstation and/or network mail system. From: Pete Z [mailto:petez@arcimoto.com] Sent: Thursday, May 6, 2021 7:35 PM To: Chief Counsel, PHMSA (PHMSA) <phmsachiefcounsel@dot.gov> Cc: Regulatory Affairs <regulatory@arcimoto.com>; Gerrit Hurenkamp <gerrith@arcimoto.com> Subject: Arcimoto -- 49 CFR § 173.185 -- Request PHMSA Office of Chief Counsel guidance CAUTION: This email originated from outside of the Department of Transportation (DOT). Do not click on links or#

Page 9open attachments unless you recognize the sender and know the content is safe. Hello PHMA Chief Counsel, Thanks for speaking with me earlier today! I'm doing some research to confirm or reject that fully battery-electric motor vehicles (EV) will need to comply with 49 CFR § 173.185. Here's my research so far: PHMSA's Interim Final Rule (IFR) became effective on March 6, 2019, see attached PDF "FedReg PHMSA 49 CFR 172-173 HazMat Enhanced Safety Li-ion 2019_03_06" Test summaries of demonstrated compliance are required starting Jan 1, 2022, see attached PDF "FedReg PHMSA 49 CFR 171-180 HazMat Harmonization With Intl Stds 2020_05_11" EV batteries are typically shipped contained within new vehicles, but also shipped separately to repair partners for service, warranty, and part sales. UNECE Transport of Dangerous Goods regulations for ground, air, & marine transport, such as UN 38.3 is relevant, and was "harmonized" by above PHMSA regulations. Typical EV battery-packs are 20,000+ Watt-hours and weigh hundreds of pounds. For some EV, each battery contains cells or a series of cells that are connected in parallel, all battery control mechanisms like BMS, contactors, major fuses, etc are external to the batteries, and there are no means inside the battery of preventing reverse current flow. Per 173.185(a)(3), “Beginning January 1, 2022 each manufacturer and subsequent distributor of lithium cells or batteries manufactured on or after January 1, 2008, must make available a test summary.” The test summary requirements are listed 173.185(a) (3)(i) to (x). Per 173.185(a)(4), there is no stated phase-in date, so it appears that for subject cells and batteries, “each lithium cell or battery must: (i) Incorporate a safety venting device or be designed to preclude a violent rupture, (ii) Be equipped with means of preventing external short circuits; and (iii) Be equipped with a means of preventing dangerous reverse current flow (e.g., diodes or fuses) if a battery contains cells, or a series of cells that are connected in parallel.” Per 173.185(c) and (c)(1), “smaller cells or batteries” may be exempt if the “Size limits” is met where “The Watt-hour (Wh) rating may not exceed 20 Wh for a lithium ion cell or 100 Wh for a lithium ion battery.” Per 173.185(c)(1), “After December 31, 2015, each lithium ion battery subject to this provision must be marked with the Watt-hour rating on the outside case.” Per 173.220(d), "Where the lithium battery is removed from the vehicle and is packed separate from the vehicle in the same outer packaging, the package must be consigned as “UN 3481, Lithium ion batteries packed with equipment” or “UN 3091, Lithium metal batteries packed with equipment” and prepared in accordance with the requirements specified in §173.185." I've completed an iSearch.NHTSA.gov review, found three letters from NHTSA Chief Counsel that are relevant to PHMSA 173.185, please see attached PDF. Questions for PHMSA: If a Li-ion battery is intended for a motor vehicle and is not "smaller," then is compliance to 49 CFR 173.185 required for either or both of the following conditions?#

Page 101. Where the Li-ion battery is contained in the vehicle and securely fastened in the battery holder of the vehicle; 2. Where the Li-ion battery is removed from the vehicle and is packed separate from the vehicle. If PHMSA has already provided guidance to other EV motor vehicle OEM (such as Ford, GM, Toyota, etc) in response to same/ similar questions, then can you share this guidance with me so we don't unnecessarily cover the same ground? I look forward to speaking with you at your very earliest convenience. Please feel free to call me anytime. Thank you, Pete Z Director of Global Regulatory Compliance Arcimoto, Inc. mobile 541-846-8198#