Enhanced VES, EEAI and Road Tax: Do Electric Cars Really Save You Money?
EV, roll out! (Side note: If you don’t get it, it was a nod to the common command by Optimus Prime to signify the start of a mission in the show ‘Transformers’.) Speaking of rolling out, since the launch of Tesla’s sales portal in sunny Singapore, the government has embarked on a mission to roll out 60,000 charging points at public car parks and private premises by 2030.
Given the generous support of S$30 million EV-related initiatives from the government, and the perks of owning an electric vehicle (EV), such as its fuel efficiency and cost-effectiveness, more drivers are inclined toward buying EVs.
So, what are the local EV schemes you should know, and the million-dollar question here is: Do electric cars really save you money? In this digestible read, we’ll give you the low-down on the cost and savings of an electric car, and you can play judge.
1. Enhanced Vehicular Emissions Scheme (VES)
There are four different vehicle emissions schemes in Singapore. They are applicable to your car or taxi depending on when it’s registered. For easy reference, refer to the table below:
|Emission Scheme||Applies to vehicles registered:|
|Carbon Emission-Based Vehicle Scheme (CEVS)||From 1 January 2013 to 30 June 2015|
|Revised Carbon Emission-Based Vehicle Scheme (CEVS)||From 1 July 2015 to 31 December 2017|
|Vehicular Emissions Scheme (VES)||From 1 January 2018 to 31 December 2020|
|Enhanced Vehicular Emissions Scheme (VES)||From 1 January 2021 to 31 December 2022|
To read up on each of the schemes, click here. About the Enhanced VES – this scheme is enhanced with high rebates and higher surcharges, and it’s based on a vehicle’s carbon dioxide (CO2) emission, coupled with emissions of 4 pollutants – hydrocarbons (HC), carbon monoxide (CO), nitrogen oxides (NOx) and particulate matter (PM).
The pollutant with the highest emission value will dictate your vehicle’s band and its corresponding rebate or surcharge. This is regardless of the car’s emissions of the other four pollutants. And if you were to register an electric or plug-in hybrid vehicle or taxi, an emission factor of 0.4g CO2/Wh will be applied to its electrical energy consumption to rate its CO2 emission.
Also, mentioned in the vehicle emission schemes is the Additional Registration Fee (ARF). In Singapore, there is a minimum ARF of $5,000 that is payable for all cars being registered, regardless of the tax rebate a car is entitled to.
Great news for all the newly minted EV owners: From January 2022 to December 2023, the minimum ARF of $5,000 will be lowered to $0 for all electric cars! This significantly affects the cost reduction of some of the more affordable electric cars.
2. EV Early Adopter Incentive (EEAI)
Remember the news about the EV Early Adopter Incentive (EEAI) that was released in February 2020? To recap, the Land Transport Authority (LTA) had announced that this EEAI scheme will provide an ARF rebate of 45% when car buyers purchase a fully electric car from 1 January 2021 to 31 December 2023.
This is capped at a maximum rebate of $20,000. Note: This incentive also applies to taxis and car rental services. Check out LTA’s news release on the EEAI, dated 18 Feb 2020, here.
3. Road Tax
Did you know? For the past few years, EV owners were at a disadvantage when it comes to paying road taxes, as they used to cost more than those of the internal combustion engine (ICE) vehicles. Typically, EV owners are expected to pay anywhere from a few tens of dollars to a few hundred dollars more a year.
The revised structure, with the adjusted five power rating categories, will see a reduction in road tax for electric vehicles. To determine the power rating: The power output of the car’s electric motor (as specified by the manufacturer), calculated in kW. Electric cars in the market will still run up an annual usage cost, though it’s still a small percentage lower than ICE cars.
Currently, the road tax reduction is approximated at a 29% decrease, and as these hybrid cars are still mostly petrol-fuelled vehicles, they will not require the additional $700/year flat component cost as part of the car charges.
4. Running Cost for Electric Cars
In hindsight, considering the savings on energy costs and EV-related incentives, an electric car is a more affordable option in Singapore. To put things in perspective, we’ll use the lowest energy consumption electric commercial vehicle (ECV), DFSK EC35 as an example here:
- Average petrol price per litre: $2.68 (February 2022 – source)
- Average annual mileage: 17,500km (2018 – source)
- Energy tariff rate: 27.22 cents/kWh (Jan – March 2022 – source)
|Vehicle model||DFSK EC35||Average diesel van|
|Annual energy cost||$3,397.68||$5,046.62|
|Yearly running cost||$6,397.68||$15,166.62|
|Savings per year||$8,768.94||–|
Electric vehicles run on clean energy as compared to traditional cars that require petrol fuel. You can also expect less wear and tear, and for added convenience, you do not render an unnecessary amount of monthly trips to the workshops.
Thinking of making the switch to green driving today? We are here to help you make better-informed choices. Book an appointment with us today to learn more about DFSK EC35 or other commercial electric vehicles. Drop us a message or make an appointment here today.