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Can Singapore become an Electric Vehicle leader?
WHILE Singapore has staked out a meaningful leadership position in the autonomous vehicle space, it can only be described as a laggard when it comes to electric vehicles. According to VMLY&R's internal analysis, this is a S$3.6 billion opportunity that can simultaneously save 33,000 tonnes of carbon dioxide emissions.
Singapore comes in at second place in the race for Autonomous Vehicle (AV) preparedness, according to KPMG's AV Readiness Index. Lauded for its Centre of Excellence for Testing and Research of Autonomous Vehicles at Nanyang Technological University, driverless shuttle trials at NUS, national standards for AVs encapsulated in TR68, and a single government entity to lead this activity, Singapore is truly well-positioned for the future of mobility.
It is something of a mystery, then, to find that the Republic is a no-show in Electric Vehicle (EV) adoption leadership. After all, an island-state with limited driving distances is a battery car's dream home.
China is developing leading EV makers and suppliers across the board. India is moving to electrify all new two- and three-wheelers by 2025. And Hong Kong sold over 11,000 EVs by January 2019. So why has the Lion City sported less than 700 EVs in the same timeframe?
It is true that we are making positive steps with our fleets. LTA trials of 60 eBuses are underway, 100 BYD EVs in the HDT Singapore Taxi (HDTT) fleet are due to grow to 800 cars by 2022, and Singapore is host to the largest e-car sharing service in the world - in the form of 469 BlueSG cars currently plying the roads as at April 2019, rising to 1,000 vehicles, 500 stations and 2,000 charging points by 2020.
But once we remove the HDT and BlueSG fleets, we are left with just over 100 EVs that have been bought for personal use. This is a rather shocking statistic. Only 0.1 per cent of all registered vehicles in Singapore are EVs. What gives?
Our surveys around the world find that range anxiety is the No 1 concern holding back potential buyers of EVs. That is, fear that an EV might have insufficient range to reach its destination and would thus leave you stranded. While that was once because of the lack of battery storage capacity, the range capacities of EVs on the market today are either almost at or exceeding the 342km per week that LTA figures show Singaporeans drive on average.
Range anxiety in our city-state is actually charge anxiety, so the discussion boils down to infrastructure. Over 80 per cent of Singaporeans live in HDB flats, with most of the rest in condos and apartment blocks, so public charging networks are crucial.
Today, Hong Kong is ahead with over 2,000 public chargers, but that lead may well be short-lived. By the end of 2020, our island-nation should host 2,000 chargers from BlueSG, 1,000 from Singapore Power, and up to 400 from Shell-backed Greenlots, in addition to other independent and privately-owned charge point providers. Our projections show that the growth of chargers is significantly faster than the growth of EVs, potentially flipping the infrastructure conundrum on its head; if EV charger utilisation levels drop below financially viable levels, will charger rollouts slow or even reverse? It is therefore vital that EV sales start to show comparable growth.
Cost is the next barrier cited, but the situation is more nuanced than it first appears. It is true that EVs cost more than internal combustion engine vehicles, but the difference is rapidly disappearing. The most expensive part of an EV is the battery, but according to Bloomberg New Energy Finance, battery costs have declined 22.9 per cent a year since 2013. They predict that by 2022, EVs will "cross over" and actually start to become cheaper than their internal combustion engine (ICE) equivalents.
We don't have to wait that long for price parity, however, thanks to the Vehicle Emission Scheme designed by NEA and which is administered by LTA. Most Singaporeans are unaware there is a S$20,000 rebate for EVs, and up to a S$20,000 surcharge on more polluting vehicles.
As an example, the Hyundai Ioniq and Renault Zoe EVs clock in at between S$100,000 and S$140,000, and are still 20 per cent to 30 per cent more expensive than their petrol equivalents.
Things get even more interesting when we start to look at total cost of ownership. Charging is significantly cheaper than filling up the tank, with Wearnes Automotive estimating that Singapore drivers can save around S$2,300 annually.
Further savings will be accrued for vehicle maintenance. According to torque.com.sg, the average cost of servicing a Honda or Toyota is S$5,280 over 10 years. With up to 100-times fewer parts in an EV compared to a petrol car, the number and extent of servicing visits needed can drop dramatically. Cap HPI estimates that smaller EVs cost 35 per cent less to service than their ICE equivalents - or savings of around S$1,800.
Reduce S$24,800 from the sticker price of the Ioniq, Zoe, Nissan Leaf or BMW i3, and suddenly the price equation can look a whole lot different.
As barriers are removed and more Singaporeans take the plunge, they will find, like EV drivers worldwide report in our surveys, a great new experience - instant acceleration, powerful torque, a quiet drive, and no smell or soot from a battery/motor combination that is up to five times more efficient.
There is currently a surprising amount of misinformation floating around about EVs in Singapore. Pundits drip with sarcasm, journalists pick fights with EV magnates, and even dealers selling EVs tell customers to go for the petrol versions instead because they mistakenly believe the government does not support electrification of transport. They should read the forward-looking Singapore Land Transport Master Plan for 2040, which clearly shows the centrality of EVs to our future mobility environment.
Indeed, our internal analysis suggests that there is a S$3.6 billion opportunity to accelerate the EV transition between now and 2021, reducing 33,000 tonnes of carbon dioxide emissions in the process. This feels like an important goal to aim for. With a well thought-through communication programme that offers both personalised tools to the public and education for dealers, we can claim our rightful place as leaders in the electrification of transportation.
- The writer is Chief Innovation Officer at VMLY&R Asia.