…If it’s a van. Electric vans could cost the same as normal ones thanks to the new CVES subsidies which kick off in Singapore on April 2021
The electric vehicle revolution could really kick off in Singapore not with powerful, sexy BEVs (battery electric vehicles) like Teslas or Taycans, but with vans, thanks to new subsidies that could put electric vans on par with regular ones in price.
The subsidies come as part of the new Commercial Vehicle Emissions Scheme (CVES) and Enhanced Early Turnover Scheme (ETS) for Light Goods Vehicles (LGVs), Goods-cum-Passenger Vehicles (GPVs), and small buses, announced by the Land Transport Authority (LTA) and the National Environment Agency (NEA) in March 2020.
CVES takes effect on 1 April, 2021. Like its passenger car equivalent, VES, the scheme encourages the purchase of less polluting, more efficient vehicles in order to improve Singapore’s air quality and lower overall air pollution here. Good, since Singapore’s air pollution levels aren’t exactly stellar, and the effects of air pollution are now much worse than we ever thought, and that’s besides it directly killing millions every year.
CVES ranks LGVs and the like under bands according to how much, or little, they pollute. CVES has only three bands, compared to five for VES: C, for the most polluting, which garners a S$10,000 penalty. B, the middle band, receives a S$10,000 rebate. A, for vehicles in the least polluting band, receive a S$30,000 incentive.
Like the VES A1 band, which nets a S$25,000 incentive, only vehicles with zero tailpipe emissions – i.e. electric vehicles – qualify. But unlike VES, there is no minimum ARF or cap on the subsidy, so it operates as a straight-up S$30,000 rebate. The first S$10,000 is given at the point of registration, and then as a S$10,000 payment once per year, for two years, thereafter.
For the purpose of loan payments, the LGV in question will therefore be S$10,000 cheaper, but effectively over three years, it will be S$30,000 less expensive, not counting inflation and other fluctuations.
This would bring the price of battery-electric light goods vehicles (BELGVs)
on the market very close to that of existing combustion-engined LGVs.
For example, when last listed on the price list in early December 2020, Renault’s Kangoo 1.5 diesel cost S$75,800 with COE, while the BEV version on sale here since 2018, the Kangoo ZE, cost S$110,800 with COE. At S$30k less, the latter would effectively be S$80,800 with COE.
Possibly the least expensive BEV LGV on the market is the BYD T3, and after the rebate, it costs similar to one of the more popular light vans around. The BYD T3, as sold by Hong Seh Evolution, currently costs S$95,800 with COE.
At S$65,800 with a COE and CVES rebate, it’s effectively the same price as Nissan’s popular petrol-powered NV200 van, which costs S$66,800 with COE for the automatic model.
Disclaimer: That’s assuming April 2021’s rebate at current price levels (vehicle + COE). As the story with passenger car VES has shown, that will certainly change.
There is an electric version of the Nissan NV 200 LGV, the E-NV200, however Nissan Singapore has not announced plans to sell it here just yet as ‘product availability remains a challenge’ with the BEV version of its NV 200, and instead it is focusing on cleaner, non-diesel LGVs, like the current NV 200.
“Instead of kicking off with the same electrified strategy as our passenger cars for our light commercial vehicles, we have chosen to kick start with a full line up of cleaner petrol vehicles instead due to their ready availability while we work on bringing in appropriate electrified light commercial vehicles with Nissan in the coming years,” said Mr Ron Lim, Head of Sales & Marketing for Nissan’s authorised distributor in Singapore, Tan Chong Motor Sales.
With prices equaling, or coming near to, combustion-engined LGVs, that could open up business owners to the main draw of an EV fleet: Lower running costs.
Like passenger BEVs, BELGVs have a far lower per-kilometre running cost than those powered by petrol or diesel. With LGVs running further than passenger EVs per day – 80km versus 44km – the cost savings to businesses could be significant. EVs also do well in urban environments, whereas combustion engines are usually at their least efficient in slower or stop-n-go traffic.
According to CarBuyer’s own math below (any mistakes are our own), a BYD T3 would only use S$1,043 in energy to travel 29,500km. That’s the average annual mileage of an LGV in Singapore. The diesel-powered Kangoo would use S$2,518 in fuel, while the NV200 would use S$4,380.
With no combustion or cooling systems to maintain and lower brake wear rates, BELGVs could also cost less to maintain in the long run.
Edward Tan, managing director of Hong Seh Evolution, a subsidiary of luxury car and yacht dealership Hong Seh Group which sells the BYD T3, thinks BELGVs could take off in a big way here in 2021.
“The rebates are a fantastic push from the government that will really help to lower not just the price of BEV LCVs, but also the daily operation cost for businesses and individuals. Electric vans cost much less to run on a day to day basis and we think their cost effectiveness is a very convincing factor for business owners,” he said.
Besides price though, the other main barrier to EV ownership is charging logistics – how and when to charge?
For a ‘real’ commercial fleet, it isn’t as crucial, since charging at an industrial premises isn’t as difficult as a residential one. Installing charge boxes is easier, as is access to industrial power supplies. Hong Seh Evolution for instance, sells an approved charging cable that utilises industrial power sockets and can charge the BYD T3 in under eight hours.
For small business owners who actually use their vans as daily transport, it could be more challenging if they don’t have access to a personal charging point. While Singapore’s charge network does exist – thanks to Greenlots, SP, and Shell – it’s still not mature or widespread. However there is hope for the near future: the large-scale expansion of Singapore’s EV charging network. According to a tender from the LTA and URA, more than 200 public carparks will install over 600 charge points by the end of 2022.
What if you simply can’t get around the lack of charge points, or the time needed, but you want to do your part and get rid of an older, more polluting LGV, but don’t want to make the jump to electric power? There’s still Band B for a S$10k rebate, and the enhanced Early Turnover Scheme (ETS), which allows you to get a new LGV but paying a discounted PQP (COE average of the past three months) if the new LGV is a CVES band A or B vehicle.
Nissan Singapore sees that as a potentially popular route in 2021, pointing out that almost 40,000 Euro 4 diesel commercial vehicles are now eligible for the enhanced ETS, where they were not before. How much? Find out here if you’re an existing LGV owner.
“All these changes open up tremendous opportunity for cleaner CVES Band A and B light commercial vehicles to expand their sales over the more pollutive diesel light commercial vehicles that will become more prohibitive to own due to the penalty they attract under CVES,” added Mr Lim.
As for the title premise, yes you could theoretically own an EV at a sub-S$70k price level assuming you have a registered company, and purchase a BELGV as a company vehicle. But the more important thing is that even if they’re not electrically-powered, LGVs are becoming cleaner and greener, and that’s good news for everyone’s lungs.