Mr Speaker, I support the motion of thanks to the President’s address during the opening of the second session of the 14th Parliament.
Mr Speaker, we read in the news this week that the certificate of entitlement (COE) premium for smaller cars crossed the $100,000 mark to reach a record high of $103,721. New records were also set in the larger car and Open categories at $120,889 and $124,501, respectively and I read that the latter is the highest price ever posted for any category of COE.
The president of the Singapore Vehicle Traders Association, Mr Neo Tiam Ting told the Straits Times that the companies that are supplying cars for ride-hailing services is a key driver behind the demand for COEs in recent years. He said that these companies, which grow their fleets aggressively and push up the COE premium in the process, are able to pass on the higher cost in the form of relatively small increases in daily rental rates, he noted, while private buyers have to stomach the premium hike in one go with a bigger loan.
This is not a new issue. I am aware that the Government stated in a PQ reply to my colleague Louis Chua last year that there is no evidence that PHC companies have caused the increase in COE bid prices.
As prices spiral out of reach of many Singaporeans who aspire or need to buy a car for different reasons, can we not do more to review how we can ensure that businesses, whether ride hailing companies, car leasing companies, or car dealers do not push up the COE premiums at the peril of private buyers who need to buy a car for various different reasons?
Such reasons can include using their vehicles for work purposes, taking care of their families with young children, taking care of elderly family members, or handicapped family members. For some of these people, operating a private hire car from a ride hailing company or using Grab or taxis may somehow not be a suitable substitute.
Can we also see to that COEs for our commercial vehicles are not subject to similar pressures? The rising COEs for this category have contributed to rising business costs and present further challenges for our smaller businesses. And added business costs also contribute to increase in cost of living for everyone. In the past week when we have been talking about combating stratification and building social compact amidst rising cost of living and rising property prices, we should be wary of the possible social effects of spiralling COE prices.
Mr Speaker, I welcome and support the Minister for Transport’s statement in his Addendum to the President’s address that MOT will further encourage the adoption of cleaner energy vehicles through regulation, incentives and infrastructure. Indeed, President Halimah stated in her address that we have committed to decisive action to reduce carbon emissions and are taking resolute steps towards meeting our net zero commitments.
The minister also said that we will review financial incentives to encourage the adoption of electric cars and monitor related developments in other vehicle segments, such as motorcycles and goods vehicles.
To date the pricing of Electric Vehicles (EVs) is still relatively unattractive compared to ICE vehicles. I agree that the Government should further review to see how we are better able to encourage and incentivise more people to switch to EVs and reducing the number of new ICE vehicles on the road.
Mr Speaker, a recent CNA article dated 11 April 2023 reported that parallel importers face limits in what EVs they can put on the road, as compared to the authorised dealers as this is partly because of how road tax is calculated, which is pegged to the EV’s power rating. One importer reported encountering problems with the homologation or registration for EVs. It was also reported that EV models with dual electric motors require proper documentation from manufacturers to confirm their power rating and this makes it tougher for parallel importers to register these cars for road use as unlike authorised dealers, they do not have direct contact with the carmakers. Another importer stated that EV options are quite limited for parallel importers and they hope for (I quote) “better support in terms of clarity on importing rules” (unquote).
I hope the Government can look into the concerns of the parallel importers, to clarify and review the rules and documentary requirements for EV sales which may be more disadvantageous to parallel importers. More importantly, I hope the Government can provide more assistance to parallel importers to encourage them to focus on getting higher volumes of EV sales as opposed to ICE vehicles.
Mr Speaker, still on transition to EVs, I next move to the issue of the electrification of logistics vehicles. In my Budget Debate Speech in February this year, I expressed my concern that it remains unclear how soon certain logistics fleets (including but not limited to light goods vehicles) will be switching to EVs entirely and I said that a number of prominent logistics companies have not yet made any plans or have not announced any plans for EV conversion or some have preliminary plans for limited initial conversion.
Indeed, I have brought up my concerns for the green transition in last mile logistics and asking for our plans for conversion of goods and logistics vehicles variously in COS Debate 2022 with the Ministry of Sustainability and the Environment and during the debate for the EV Charging Bill in November 2022.
In the MOT COS debate last month, I also asked whether the Government will actively engage logistics companies directly on their plans to convert to EVs and to speed up the process. SMS Amy Khor replied that (and I quote) “on logistics companies’ transition to cleaner vehicles, we are working with them, but it is now limited by the availability of this kind of vehicles, in terms of technology” (unquote).
Sir, during the MSE COS debate in 2022, I have said that we have also seen electric light commercial vehicles models increasingly being rolled out by manufacturers such as Renault, Opel and BYD.
More recently, we read that in US, Schneider has delivered its first short haul logistics EV trucks, while Tesla has also delivered EV trucks to PepsiCo.
Mr Speaker, while I appreciate MOT’s efforts to engage our logistics companies in this area thus far, and admittedly some manufacturers may have only started to build such electric commercial vehicles not too long ago, I hope the MOT will increase its engagement with logistics companies to persuade them to have stepped plans for the conversions.
I hope MOT will have a dedicated road map on the conversion of the logistics and goods vehicle fleet operating in Singapore in the next few years and will work closely together with logistics companies on such a road map.
Mr Speaker, during the EV Charging Bill debate in November last year, I also mentioned that we have a large number of goods vehicles which come in from Malaysia on a daily basis. I hope the Government will also have a plan to handle this large group of foreign ICE vehicles coming into Singapore and travelling all over Singapore every day even if this may take even more time given that they are foreign vehicles. Yes, we may need the goods and supplies these goods vehicles bring in every day but it will be good to know that the Government has a plan in respect of these vehicles even if it may involve foreign government or agencies. We should not let their emissions delay our zero emissions goals indefinitely.
Mr Speaker, I would also like to congratulate MOT and Maritime and Port Authority of Singapore (MPA) for the launch of the first electric ferry, the Penguin Refresh, on Monday to carry Shell’s workers, contractors and visitors between Shell’s Pulau Bukom premises and Pasir Panjang Ferry Terminal. It is also commendable that MPA is working with Shell to allow other electric harbour craft to access their electric chargers in due course.
This is a big first step in the decarbonisation of the harbour craft fleet in the port of Singapore. Under MPA’s Maritime Decarbonisation Blueprint: working towards 2050, all harbour craft will operate on low carbon energy solutions such as blended biofuels (e.g. the B100 fuel) or hybrid diesel-electric propulsion by 2030 and by 2050, will operate on full electric propulsion or net zero fuels, in order to achieve 15% reduction off 2021 levels by 2030 and 50% off 2021 levels by 2050. I support these plans and I hope we can achieve the targets ahead of time.
In the course of my professional work over the years, I had to use harbour launches to board vessels lying in nearby anchorages over the years. I hope the familiar smell of the engine fuel of our old harbour launches will be a thing of the past. In fact, I can remember in the past I would have to pick one of the many harbour launches lying alongside Clifford Pier, effectively like water taxis, and the pier smelling of the fumes.
Mr Speaker, while it is noteworthy that Shell estimates that it can save more than 6000 tonnes of carbon dioxide a year, the ferry operation is far from being the main stay of Shell’s business. In my Budget Debate speech in 2022, I mentioned that Shell had in November 2021 announced that it was halving its crude processing capacity at its Singapore hub and reducing fuel exports. The oil major, a major part of our oil & gas industry, is intending to transit from fossil fuels to cut emissions and meet global low-carbon energy needs. I acknowledge that this is part of a wider global trend in a transition towards lower carbon fuels, and it undoubtedly will affect Singapore in some ways.
Mr Speaker, I hope the Government will continue to update the house on the transformation of our petrochemicals sector, on the green transition process in the sector, whether Singapore will continue to attract and retain parts of the petrochemicals industry in Singapore that are relevant for the green economy.
I hope the Government will provide updates on our efforts in attracting more businesses in areas like biofuel refining or sustainable aviation fuel production or storage for such fuels as well as updates on carbon capture and sequestration at petrochemical plants.
And finally, I hope the Government will continue to update the house on the just transition in manpower for our workers working in Shell and other companies in the petrochemical sector – what we are doing to retain and retrain workers in this sector as the sector transforms within Singapore.
Mr Speaker, I support the motion of thanks to the President.