What Drives Electric Vehicles Here?

This article was published in Business Times on 9 September 2011.

GLOBAL crude oil prices have risen to record highs over recent months and petrol prices have risen in tandem. Factor in growing concerns over global warming and issues of energy security, and the stage appears set for the electric vehicle (EV) to appear in Singapore.

The benefits of adopting EVs are significant. Maintenance and operating costs of EVs can fall to a third of those of their conventional counterparts, leading to cost savings for customers. On the environmental front, EVs themselves produce no tailpipe emissions, but the gencos (power generation  ompanies) that produce electricity do. Singapore largely relies on natural gas to generate electricity, which is significantly cleaner than gasoline or diesel which are used in conventional vehicles.

However, an EV currently costs $90,000 - four times the price of its conventional counterpart, explained mainly by the battery cost. EVs also suffer from relatively short driving ranges of about 160km, and require up to eight hours for a full charge. Notwithstanding this, rapidly advancing battery technology is projected to reduce charging time, increase driving range and reduce battery cost. As EVs become increasingly commonplace, the derived economies of scale are likely to further drive down EV prices.

With EVs still in the early stages of development, test-bedding is common in many cities around the world. In most cases, these are private initiatives by EV manufacturers and charging service providers, intended to assess their e-mobility concepts for rollout and also to gain consumer acceptance.

Test-beds like those in Colorado and Australia involve rollouts on a limited scale. The results to determine the feasibility of commercial rollouts will be out only within the next two years. Other test-beds have been implemented to assess various charging technologies and models. In Tokyo, battery switch technology is being tested in taxi fleets while smart charging is being tested in North Carolina.

In contrast, cities such as London have opted for a different approach by implementing direct commercial rollouts. Four hundred charging points have been set up throughout London and charging can be carried out for a fixed monthly membership fee. Commercial rollouts are also being implemented in Berlin, San Francisco and Paris.

The different approaches across cities in introducing EVs reflect varying levels of readiness of the markets for EVs. Additional EV business models include leasing schemes like those in Los Angeles.

While results from overseas experience may be useful, the rate of EV adoption is also uniquely shaped for each city by urban density, public awareness, driving habits, local weather conditions and economic affluence. Singapore should not rely solely on others' experience for its own policy decisions.

One of the key issues is that with most of Singapore's population living in high-rise public housing, publicly accessible charging infrastructure is essential for EVs to take off. The private sector has been hesitant to invest in charging infrastructure in Singapore due to the nascent EV market and uncertainty in future take-up rates.

This results in a Catch-22 situation whereby the EV market fails to take off with the lack of charging infrastructure and charging infrastructure is not constructed without a viable EV market.

Therefore, a multi-agency taskforce - chaired by the Energy Market Authority (EMA) and Land Transport Authority (LTA) with other partner agencies - has been set up to test and gauge different EV prototypes and charging technologies given Singapore's urbanised environment and its weather and road conditions, before deciding whether it is feasible for EVs to be adopted on a significant scale.

Singapore's small size renders it a unique location suitable for EV test-bedding since city landscapes mean shorter travel distances and the ability to set up charging infrastructure quickly.

The Singapore EV test-bed has incorporated lessons learnt from other ongoing test-beds. For example, the Plugged-in Places pilot programme in the UK has shown that the problems in implementation are often not technical but due to legal restrictions and difficulties in urban planning and private/public cooperation.

The EV test-bed in Singapore helps to lay the groundwork for possible commercial rollouts in the future by aligning a multitude of stakeholders such as transport planners, car manufacturers, charging infrastructure providers, landlords and EV users towards a common goal. In the Netherlands, the E-laad pilot project found the cost of charging infrastructure to be unfeasibly high for a large scale rollout and this led to a re-evaluation of their initial design.

The test-bed in Singapore is premised on a 1:1 charging station-to-vehicle ratio. As the test-bed study progresses and additional data on charging and consumer behaviour is collected, this ratio will be revised accordingly.

In early 2011, a report by Accenture highlighted the need to study consumer uptake, noting that many studies failed to regard the private consumer and how many will actually buy EVs.

While the test-bed in Singapore is open to companies only through the TIDES-PLUS programme, it can also serve to raise awareness and generate interest in individual consumers, more so if consumers are environmentally conscious in creating a greener future for Singapore.

To this end, the Energy Studies Institute (ESI) is conducting a market survey complementary to the test-bed to study consumer perception and attitudes towards EV adoption in our local context.

A key aim of the test-bed is to obtain data to quantify the economic and environmental costs and benefits of EV adoption in Singapore. The analysis will be carried out by the ESI.

Other desired outcomes of the test-bed include attracting different technology suppliers and EV component manufacturers to Singapore, thus leading to additional R&D opportunities on EVs; and allowing Singapore to gain recognition in the global community as a living laboratory for innovative technologies, thereby making the Republic more attractive to foreign investors.

While it remains to be seen if EVs will take off in Singapore, other private initiatives which have potential to develop the domestic market are being pursued - with SMRT Corp in talks with China's BYD Co Ltd to explore the use of electric vehicles for bus and taxi fleets in Singapore; BMW announcing plans to launch its electric BMW i3 here in 2013; and the import of the Tesla Roadster by local firm FSG Mobility Concept.

Buy-in from the private sector is important for EVs to become sustainable in the long run, and the outcome of these efforts will be crucial in determining the fate of EVs in Singapore.

Chua Wen Hao is an energy analyst and Jonathan Chan Chun Ming is an intern at the Energy Studies Institute, National University of Singapore. ESI is a multi- disciplinary autonomous research institute established within NUS. Its key research areas are energy economics, energy security, and energy and the environment

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