Tackle issues relating to green vehicles

I am encouraged by recent government efforts to promote the usage of green vehicles (“Singapore not meeting its air quality targets: Masagos”; Jan 26, online).

While there are a number of challenges in promoting large-scale adoption of green vehicles, such as awareness and infrastructure, the key factor is cost.

I may be keen to drive a green vehicle, but only if it is not considerably more expensive or inconvenient to operate than petrol alternatives.

In that regard, the relevant ministries should look into the gaps in the incentive and tax system.

First, the Carbon Emissions-based Vehicle Scheme adjusts the upfront cost but does not fully address the yearly depreciation, which is my key cost consideration.

A $15,000 surcharge now causes depreciation to increase by $1,500 per year, but a $15,000 rebate equates to a $750 reduction per annum or less, owing to the Preferential Additional Registration Fee (Parf).

Second, the CEVS may indirectly promote usage of cars beyond 10 years, which are less efficient and do not have the benefit of newer technology.

As the CEVS reduces the Parf value, it makes monetary sense for drivers to extend the Certicate of Entitlement if the car is in working order, owing to the minimal Parf forfeiture.

Third, authorised dealers are not incentivised to promote greener vehicles.

If we can instead achieve cost equivalence between green vehicles and petrol alternatives via a targeted taxation and incentive structure, we would be able to create momentum for the adoption of green vehicles.