Early adopters of electric cars unfazed by obstacles

Early adopters of electric cars talk about their conversion in the face of dismal incentives and infrastructure

Singapore has been slow to plug into electric vehicles (EVs) and plug-in hybrid electric vehicles (PHEVs), despite their potential to reduce carbon emissions dramatically.

According to Land Transport Authority figures, there are just 129 EVs and PHEVs here (as of endOctober), with BMW accounting for most of these cars.

The 129 units translate to a mere 0.02 per cent of Singapore's car population of 601,948.

According to a 2011 report by the Asia-Pacific Expert Group on New and Renewable Energy Technologies, a 2 per cent penetration by 2020 will be able to reduce Singapore's total carbon emissions for the land transport sector by 4 per cent. The group is under the Asia-Pacific Economic Cooperation (Apec) Energy Working Group and promotes the increased use of new and renewable energy technologies in the Apec region.

Seven years ago, Singapore pledged to reduce its emissions growth to 16 per cent below "business as usual" levels by 2020. In September this year, the Republic ratified the Paris Agreement and pledged to reduce its emission intensity by 36 per cent from 2005 levels by 2030.

 

Several reasons have been cited for the slow adoption of electric mobility here, including high purchase price, the lack of charging infrastructure, aversion to new technology and unclear national policies on green cars.

But the early adopters do not see these obstacles as being insurmountable, even if some of them are driving tax-free electric models in a test-bed programme.

Mr Tan Kian Hwee, 38, manager of power and utilities at Sembcorp Industries, was among the first to drive such a tax-free EV.

He says the electric Renault Fluence ZE he has been driving since 2012 is dependable.

"It has already clocked 90,000km," he says, adding that it has a range of about 100km and takes about six hours to recharge.

"From a business viewpoint, what you want is low cost, less down time, and trouble-free maintenance."

Mr Eu Pui Sun, 59, senior vice- president of corporate sales at Senoko Energy, has been driving a test-bed Mitsubishi i-MiEV since 2011. It cost Senoko $88,000 - less than half of what it would have cost if all the usual taxes applied.

Mr Eu reckons more needs to be done "in terms of government tax incentives" if EV adoption is to gain traction here. Otherwise, their inherently high cost will put off many consumers.

For example, a Mitsubishi Outlander PHEV costs $180,000, while a petrol equivalent is $128,999. Hence, Mitsubishi agent Cycle & Carriage has not sold a single Outlander PHEV since its launch 18 months ago.

Higher prices, however, have not stopped Jurong Port and Singapore Power from buying electric Renault Kangoos, which cost about 20 per cent more than their diesel equivalent. They are the first corporations to do so without the hefty tax breaks afforded by the EV test-bed.

In fact, SingPower says its electricity distribution arm SP PowerGrid plans to convert its entire fleet of service vans to electric vehicles.

Meanwhile, low running cost and high performance have swayed buyers of higher-end EVs.

Mr Han Fook Kwang, 63, a senior fellow at the S. Rajaratnam School of International Studies, says he is "blown away" by his battery-operated BMW i3.

Mr Han, former editor of The Straits Times who drove a Porsche 911 previously, says: "The best thing is I don't ever have to visit a petrol station. It is so quiet and nippy, too. So what's not to like?"

He bought the i3 last year for $165,000, when it was under a year old. A new one costs about $210,000.

Dr Karen Soh, 43, who runs an aesthetics clinic, is impressed with her BMW i8, a $580,000 PHEV coupe.

"It's a trailblazer for a sports car," she says. "Not only is it a green car with low emission and high efficiency, even the materials of the car are eco-friendly."

She says she clocks about 600km a month and spends only $70 a month on petrol - exceptionally low for a 360bhp car.

Both Mr Han and Dr Soh say there are few public chargers here.

There are 74 public charging stations across the island managed by Bosch and Greenlots.

And 2,000 more will roll out when an electric car-sharing test-bed programme kicks off next year. About 400 of those will be made accessible to the public.

In comparison, there are only 200 petrol stations.

Critics also cite Mr Joe Nguyen's case as an invisible hurdle to EV adoption.

The 45-year-old senior vice-president of an Internet research firm imported a used Tesla Model S P85 from Hong Kong last year. It took him more than six months to get it approved and registered.

His $400,000 car was also slapped with a $15,000 carbon surcharge - the first electric car to be penalised this way. He also had to make a written undertaking to the Energy Market Authority not to charge his car at public charging stations, "which are not adapted for Teslas".

Still, Mr Nguyen is glad he bought the car. "It is silent and the torque is simply amazing," he says, adding that its range of 380km is more than ample for his typical daily mileage of 80 to 100km.

He adds that his electricity bill for the Tesla "is just $80 per month", compared with the $350 to $400 he spent on fuel for his previous car, a Toyota Wish.

Observers, however, say EVs will continue to appeal only to a niche segment of buyers unless major changes are made to Singapore's car taxation scheme.

National University of Singapore transport researcher Lee Der- Horng says electric cars are not only costlier to buy, but they also "have no resale value".

Take, for example, theBMW i3, which has an open-market value of about $45,000. If it is deregistered just before its 10th year, it is granted $12,500 in scrap rebate, versus $27,500 for a petrol model of the same value.

Even though Singapore's compact size means an EV's current range of 100 to 150km is usually more than adequate, "many car owners want to drive to Malaysia", Prof Lee says.

"If the government really wants to encourage EVs, it could exempt them from COE," he says. "But from a car policy point of view, is that what we want to do?"

He adds that the authorities may feel the air quality here is still "fairly good" and there is no urgency to promote EVs, unlike in, say, China, where city smog is often near hazardous levels.

In short, he says he is "not optimistic" about the prospects of electric cars here in the short term.

Besides economic and fiscal reasons, another factor - battery reliability - may be tripping EV adoption.

Mr Eu reveals that this is an issue with the Mitsubishi i-MiEV he has been driving. It had a "realistic range" of 120km when new, but that has now been halved to 60km because of battery wear.

Still, the engineer says it is still able to cover his typical daily mileage of less than 50km.

"The i-MiEV runs like clockwork and has never broken down in over five years and 65,000km," he says.

"You just have to be mindful of its effective range and plan your trip accordingly."

Asked if he would buy an electric car himself, Mr Eu, who owns a diesel Renault, says he would if the price was similar to that of a conventional car.

In spite of its drastic battery degradation, the running cost of the i-MiEV "is still lower" than that of a petrol model, he says.

•Additional reporting by Christopher Tan


Cost of going green
 

Singapore grants a maximum tax rebate of $30,000 for electric cars, but "claws back" part of this in the form of significantly lower scrap rebates.

The Land Transport Authority also applies a grid emission factor to account for CO2 emissions during the electricity generation and distribution process. Such a factor is not applied to the production and distribution of petrol or diesel.

Singapore's road tax treatment of these green vehicles is also controversial. A BMW i3 with a power output of 125kW is subject to an annual road tax of $1,776, while a 266kW BMW i8 enjoys a lower annual road tax of $1,232.

Meanwhile, a 310kW electric Tesla Model S attracts a road tax of $6,202 - more than 21/2 times the amount levied on an equally powerful 309kW petrol Porsche 911 Carrera S ($2,362).

In contrast, Hong Kong's road tax for electric cars is weight- based, while the levy for conventional cars is based on engine size. A 2.2-tonne Tesla Model S 85D would attract a tax of about HK$911 (S$168), versus HK$5,794 for a 1,500-2,500cc petrol car.

In Hong Kong, electric vehicles (EVs) are granted a waiver of the First Registration Tax - a tiered levy ranging from 40 to 115 per cent of a car's taxable value. The tax is similar to Singapore's Additional Registration Fee (ARF, or the main car tax).

The waiver, which ends in March next year, makes an electric car like the Tesla Model S about 40 per cent cheaper than a Mercedes-Benz E200. (In Singapore, a Model S is nearly 50 per cent costlier than an E200.)

Businesses in Hong Kong which purchase EVs are also allowed to deduct the capital expenditure incurred under its profits tax.

There is a HK$300 million Pilot Green Transport Fund to subsidise public transport and goods vehicle owners, and HK$180 million is allocated to bus companies to trial 36 electric buses.

Tesla, which accounts for some 70 per cent of electric cars in Hong Kong, offers owners a guaranteed buyback scheme at 75 per cent of a car's purchase price.

Finally, there are more than 1,400 public charging stations in the territory.

With all these in place, Hong Kong's electric car population swelled from 178 units in 2011 to 6,298 in September this year, according to Hong Kong Transport Department statistics.

The latest figure translates to 1.1 per cent of Hong Kong's total car population of 579,104. In comparison, Singapore's 129 electric cars represent a mere 0.02 per cent of its total car population.

Still, with electric cars accounting for 4.8 per cent of new car sales in Hong Kong last year, the territory's EV adoption rate is far behind Norway (22.4 per cent) and the Netherlands (9.7 per cent) - countries with arguably less generous EV incentives.

A version of this article appeared in the print edition of The Straits Times on December 03, 2016, with the headline 'Batteries included'. Print Edition | Subscribe