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Singapore’s electric jolt to decarbonise cars

Singapore’s electric jolt to decarbonise cars

Key Takeaways
  • The greatest concern for Singaporean consumers is the lack of charging infrastructure. Until now, only around 2,500 charging points in Singapore have been installed, leaving many without easy access.
  • The government has now set a target of 40,000 charging points in public carparks and 20,000 in private premises by 2030.
  • The government’s change of tone and the incentives schemes have been responsible for 8.4% of all new cars registered in Singapore up to June 2022, which is a twenty-fold increase from 2020.

Singapore is highly regarded as one of the best examples of long-term urban planning, which has, over the years, transformed the tiny island nation into the well-oiled metropolis of today. Car owners are typically affluent, ownership is highly regulated, accepted and top-down, and range anxiety is not a concern (from east to west, the island of Singapore is just 50km wide). 

Under these circumstances, one would think that electric vehicles (EVs) would be rampant in the city-state. But of the 645,000 vehicles on the road in 2021, less than half a per cent were fully electric – 2,942 to be exact. Norway, in comparison, which is at the forefront of the electric cars movement, is at 65%  EV ownership and, in Hong Kong, EVs make up at least 2.7% of private cars.  

The slow adoption of EVs in Singapore seems the result of a government that has long been curious but critical of the viability of electric vehicles. As early as 1994, there were discussions in Singapore’s parliament about being a first mover, during which then environment minister Mah Bow Tan promised that “when they [EVs] are commercially viable, we will certainly look into their use in Singapore”. 

Although Singapore developed one of the first testbeds for EVs in 2009, the city-state didn’t prove to be exactly EV-enthusiast friendly. In 2016, when a local imported an electric car, he was shocked to have to pay an additional S$15,000 carbon surcharge on it. The Land Transport Authority (LTA) argued that electric cars are not “carbon emissions-free” since about 95% of electricity in Singapore is generated using natural gas.  As recently as 2019, when Elon Musk tweeted that Singapore was unwelcoming to Tesla and not supportive of electric vehicles, the government showed its displeasure.. Mr Masagos Zulkifli, then minister for the environment and water resources, responded, “We are not interested in a lifestyle. We are interested in proper solutions that will address climate problems.”

A late change of heart

However, in 2020, amid the growing realisation that the island nation faces existential threats due to rising sea levels, hotter temperatures and more intense rainfalls,  the government had a change of heart. In 2019, it announced that it would invest no less than S$100 billion (US$70 billion) over the next century to protect itself against the effects of climate change. 

Mitigation, too, received more attention. Transport, although not the biggest polluter compared to the energy and industry-related emissions, still makes up more than a tenth of the Lion City’s total emissions. The definitive change in policy came with the city state’s new budget in 2020 when deputy prime minister Heng Swee Keat declared EVs the most promising cleaner vehicle technology and stated that Singapore is “placing a significant bet on electric vehicles and leaning policy in that direction”. This was then followed by the commitment, within the city’s Green Plan 2030, to have 100% cleaner energy vehicles by 2040, slash 80% of land-transport emissions (using 2016 emissions as the baseline ) and phase out internal combustion engines (ICEs) completely.

Tackling the Key hurdles – Price and Charging

Since then, the government has been keen to systematically bring down hurdles in the EVs path, which are still significant. EVs with their expensive batteries are still too pricey, and there aren’t enough charging facilities. 

Price

In Singapore, owning a car is a luxury and a privilege, since you have to bid for a certificate of entitlement (COE) every 10 years. This limits the number of cars on the island nation, making it one of the most expensive places to own a car in the world. The COE is segmented into five categories according to engine capacity (CC) and engine power (Kw). Even modest EVs tend to be more powerful to make up for their heavy batteries, which puts them in categories with combustion engine cars that have significant carbon footprints. 

But, since March 2022, EVs have been classified separately, which allows more of them to fall under the less taxed category, lowering the financial burden on their users. Combined with government incentives, such as “early adopters” schemes and tax rebates, the price of electric cars is now moving closer to comparable cars with other propulsion systems, which is easily around S$100,000 (US$70,000).

Charging

According to a Deloitte Global Automotive Consumer Study 2021, however, the greatest concern for Singaporean consumers is the lack of charging infrastructure. The problem is more acute in Singapore compared to other countries because most people in the densely populated city-state of 5.4 million live in high-rise apartment complexes. Until now, only around 2,500 charging points in Singapore have been installed, leaving many without easy access. Therefore, the government has now set a target of 40,000 charging points in public carparks and 20,000 in private premises by 2030. This means that about 550 charging stations have to be built every month to reach the target, a momentous task. No wonder a law, making it mandatory for new buildings to install charging points, has been proposed.

Pivotal points? Not yet

There are already clear indications that the government’s change of tone and the incentives schemes are having an effect. EVs have been responsible for 8.4% of all new cars registered in Singapore up to June 2022, which is a twenty-fold increase from 2020. In addition, the feud with Tesla seems to have been laid to rest, after the carmaker opened up a showroom at a prime location and even had the most-sold sedan model in Singapore at one point last year. But, to speak of these statistics and occurrences as pivotal points for EVs adoption on a wider scale seems to be premature. As Mr Alvin Seet, the treasurer of the Electric Vehicles Association of Singapore and an industry insider, put it: “Singaporeans are very pragmatic. A minority of people do it for environmental reasons, (but the) majority are just looking at their wallet”.

The Singapore government seems to have shed its wait-and-see attitude towards electric vehicles, leaning on integrating them completely. Now, it is up to Singaporeans to follow suit.


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