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Eco way to cope with transport energy needs

POSTED BY admin ON 31 March 2012

Mitsubishi Mirage

Between now until 2040, ExxonMobil expects the total number of personal vehicles in the world to reach 1.6 billon vehicles.

According to BP’s Energy Outlook 2030 report, electric vehicles and plug-in hybrids are not expected to make any meaningful contribution in lowering total transport energy consumption before 2030.

Meanwhile, oil consumption by the transport sector among countries who are not members of the OECD is expected to eclipse industrial consumption by 2030.

Studies by the United Nations’ Department of Economic and Social Affairs suggests the number of megacities with a population of 10 million or more will increase to 22. Half of these megacities will be located in Asia, three in China and two in India.

As these megacities grow economically, more and more of its inhabitants will get their first taste of personal mobility. This places serious pressure on resource consumption and traffic management.
Beijing, for example, has 4.7 million registered cars, excluding vehicles transporting goods in from other neighbouring cities. Beijing city planners say their roads can only support 6.7 million vehicles.

Some roads in Beijing are already operating at way beyond their designed capacity. In August 2010, the China National Highway 110 connecting Tibet to Beijing broke the dubious record of having the longest traffic jam in the world – stretching 100 km and continued for 20 days.

The traffic in Bangkok city is famous for not just its two-wheeler tuk-tuk taxis, but also for its notorious traffic jam. It is also one of the most polluted cities in the region.

More than five years ago, the Thailand Board of Investment (BoI) was directed by the former Thakshin government to draft a new automotive policy that will move Thailand’s automotive industry up the value chain.

Up until then, the Thai automotive industry is centered around fuel guzzling and polluting pick-up trucks. The board noted the trend of automakers downsizing their engines and promoting fuel efficient technology.

Starting from 2005, a series of policies were drafted to promote eco-friendly cars. Interestingly, hybrids were not the focus.

Compressed natural gas powered vehicles are taxed at a lower 20 per cent, versus 30 to 50 per cent on normal cars.

Cars that support E20 gasohol (petrol with 20 per cent ethanol blend) fuel get a 5 per cent deduction in excise duty.

Hybrid cars are taxed at a lower 10 per cent excise duty. Import of hybrid CKD packs, including hybrid batteries and electric motors from Japan, are exempted from import duties under a separate Japan-Thailand Free Trade Agreement.

The one policy that attracts the most attention is the Eco Car Policy, announced by the BoI in 2007 where eco-cars attract a low 17 per cent excise duty.

To qualify, an eco-carmust achieve a minimum fuel economy of 20 km/litre, engine capacity below 1.3-litre, emit no more than 120g/km of CO2 and meet UNECE regulations on frontal and side impact crash.

In comparison, a Toyota Prius c hybrid has a fuel economy of 25.6 km/litre, just slightly better than an eco-car.

Eco-cars are not only the most fuel efficient type of cars on sale in Thailand, but also one of the cheapest, with a starting price of around RM38,000 for both the Nissan March and Mitsubishi Mirage.

Because of their low price and high volume, the contribution of eco-cars is more significant than hybrids in lowering Thailand’s total transport energy consumption.

Eco-cars currently on sale in Thailand.


Malaysia’s current policy of exempting hybrid vehicles below 2,000cc is commendable, but with less than 10,000 hybrids sold last year (less than 2 per cent of total cars sold), the environmental benefits are insignificant.

Malaysia spent an estimated RM16 billion in fuel subsidies last year. A significant portion of it went to drivers of luxury limousines and SUVs as most of them have no problem running on subsidised RON95 petrol.

In fact, the country spent more on fuel subsidy than on higher education (RM10.2 billion) and hospitals (RM15.2 billion).

Policy makers must acknowledge that there are many ways to reduce vehicular exhaust emission and fuel consumption. Hybrids are just one of the many solutions possible. A progressive automotive policy should not be biased against any one particular technology. Any technology with the ability to lower fuel consumption and vehicular exhaust emission should be considered.

This article first appeared in March-28’s edition of CBT Quarterly Review.

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