Green rebates will end and their clean-fuel advantage could be lost
Christopher Tan, Straits Times 12 Feb 09;
ARE compressed natural gas (CNG) vehicles viable here?
After a slow but steady introduction of tax breaks and funding assistance from the Government, after the opening of two refuelling stations on the main island (with two more to come this year), and after last year's record pump prices, you would think we would have by now a clear answer to that question.
The truth is we are not much closer to finding an answer than when an inter-ministerial committee started studying CNG's feasibility back in the 1990s.
Last year's spurt in CNG vehicle numbers - with bi-fuel car numbers growing by more than 10 times over 2007's 248 - may be interpreted as a positive development.
But the boom was in fact on the back of motor dealers aggressively marketing gas-retrofitted cars - based solely on the 40 per cent green vehicle tax cut accorded to environmentally friendlier vehicles. The upfront savings work out to be $6,100 for something small like a Honda Airwave and $14,400 for a Toyota Estima - one of the most commonly-converted cars here.
Alas it was also on the back of ill-informed consumers who knew little about CNG cars, other than the fact that they are cheaper because of the tax break.
Many new owners soon became disenfranchised. They discovered that CNG cars need to be refuelled frequently because of their limited range. And that there are long queues at CNG stations.
Some retrofitters did not do a good job, resulting in poor performance in many cases, and vehicle-stalling in some. The quality of CNG gas can fluctuate, leading to unpredictable engine efficiency.
Of the 2,500 converted cars here today, many run mainly on petrol - often lugging a huge, heavy and empty CNG tank in the boot.
When pump prices fell back to saner levels towards the last quarter of last year, interest in gas cars dissipated quickly, largely also because CNG suppliers were slow in lowering rates.
Around the same time, there was growing speculation that the Government may lift a tax exemption on CNG vehicles. That looked to be the final nail in the coffin.
Of the 20 motor workshops which ventured into CNG retrofitting, 10 have stopped the business. New sales of CNG vehicles slowed to a crawl in the final months of the year.
Last month, during the Budget announcement, the Government shed new light when it said the tax exemption will carry on. However, it added that the 40 per cent green vehicle rebate will no longer be offered on new cars from 2012.
It also said CNG will be taxed at the pumps from that year, starting with 20 cents per kg of gas.
With the clarity, will consumers warm to natural gas again? Should they?
The short answer: It depends. If they have the means to buy a bi-fuel Mercedes-Benz E-class (the only purpose-built CNG car available here), and a refuelling station is within easy reach, then they should definitely go for CNG.
The fuel is relatively clean and inexpensive. Even after a 20 cent/kg duty is levied on it from 2012, CNG is likely to be cheaper than petrol.
Currently, CNG is retailing at about $1.20 per kg, or 89 cents per equivalent litre. That is about 60 cents lower than 95-octane petrol.
Converting a conventional petrol-powered car to run on CNG is a less attractive option. But it can still be viable if you are prepared to live with an appreciably smaller boot, or in some instances, fewer seats.
Much depends on who retrofits your car. A poorly converted car will have lower efficiency, less refinement and questionable dependability.
Currently, there is no industry certification or auditing body. So the consumer has to suss out for himself which outfits are competent.
Hint: Find out how long a retrofitter has been in the business, and visit the facility to get an impression of how well-run it is.
Again, a refuelling station - preferably a big one - must be within easy reach.
Next, the choice of car. It is foolish to convert something that is compact and already fuel-efficient. Likewise, it would be counterproductive to convert a sports car.
Obviously, the space the kit takes up, and the weight it adds (about 70kg) would be quite detrimental to such cars.
A bigger car can afford the space; and its suspension and braking system are more likely to be able to withstand the additional and unevenly-distributed weight of a CNG kit better.
Certain engine types may not be suitable for conversion, including turbocharged, supercharged, direct-injected and engines with sophisticated valve timing and lift control.
The rule of thumb: The simpler the engine, the more trouble-free the conversion.
For Singapore, a sizeable CNG vehicle population is desirable. Firstly, it reduces our complete dependence on oil. The competition that gas will bring to the fuels market should also help keep pump prices in check.
Finally, let us look at the environmental benefits of going CNG (if any).
Compared with diesel vehicles - from public buses to heavy trucks and taxis with 20-year-old engine technologies - CNG is as clean as a whistle.
Even when compared with our cars - among the youngest population in the world - CNG is superior, notably in terms of carbon dioxide and carbon monoxide emissions.
But as Singapore adopts more stringent emission standards, and legislates cleaner fuels, the present environmental advantage of gas may diminish.
Advances in hybrid technology, electric propulsion systems, and perhaps even hydrogen know-how will soon bring new possibilities to folk seeking alternatives to the petrol and diesel choices available today.
Until then, going gas is a reasonably affordable way to do your bit for the environment, and save several hundred dollars at the pumps each year in the process.
Then again, you can do practically the same by picking a fuel-efficient petrol car and adopting good driving habits. The only thing is, you will not enjoy the 40 per cent tax break with this option.
