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SINGAPORE – Mr Benny Tay, 45, was “a little disappointed” when he learned that he had to pay more for gasoline as of Tuesday (February 16).
As a Gojek driver, I expected gasoline prices to drop, especially as demand for private rental cars has yet to return to pre-coronavirus levels. Because the distance you travel on the job requires you to refill your tank daily, Tay estimates that the 10-cent-per-liter increase in tax for the 95-octane gas, which you use, translates into an additional cost of $ 5.50 to $ 6 each day.
“I thought, ‘Here we go again,'” Tay said. “I’m pretty stunned right now as gas prices tend to go up instead of down. But I thought this time it would be different with the bad economy.”
“I will probably have to drive an additional trip a day to make up for the higher gas costs.” Tay said he now works 12 to 14 hours a day, six days a week. He noted that there are fewer passengers now and he has to roam the streets with an empty car for longer periods of time.
To cushion the blow of the trek, taxi drivers and private drivers like him will get a 15 percent discount on their road tax for one year, and an additional $ 360 fuel tax refund for four months if they are drivers. assets.
The tariff hike announced Tuesday was the first in six years and came as pump prices were already at their highest in nearly a year, matching what they were before the pandemic caused oil prices to plummet. Worldwide.
They went up even higher on Wednesday, reflecting the increased duties. Premium grade gasoline (98 octane and higher) retailed for between $ 2.68 and $ 3.01 per liter at all stations here, and Shell’s V-Power crossed the $ 3 mark for the first time.
Prices for 95 octane gasoline were $ 2.32 per liter, except for the SPC, where it was $ 2.25. Prices per liter for 92 octane were $ 2.28 at Caltex and Esso, and $ 2.21 at SPC.
Gasoline tariffs now stand at 79 cents a liter for 98 octane and higher grades and 66 cents a liter for 92 octane and 95 octane, an increase of 15 cents per liter and 10 cents per liter respectively.
The government said the latest measures are intended to encourage Singaporeans to reduce the amount they drive or get people to consider buying electric vehicles (EVs), which are more environmentally friendly.
But motorists, car dealerships and observers The Straits Times spoke to said the hikes are unlikely to change motorists’ behavior anytime soon.
The current underdevelopment of electric vehicle charging infrastructure, especially in the Housing Board blocks, means that electric vehicles are not yet feasible for most drivers.
Lennard Chan, 45, a data science student at the IBM skills academy, said: “I drive a hybrid car, but I will not consider electric vehicles until there are enough charging points. I refill the tank once every week and a half, so it’s not too painful. “
He’s resigned to the increase in the gasoline tax. “There is no choice but to live in the times.”
Raymond Tang, managing director of Yong Lee Seng Motor car dealership, told The Straits Times that “the mass market is just not ready” for electric vehicles.
Aside from the shortage of charging points, people have not embraced electric vehicles as a mainstream option. He said it took nearly 10 years for hybrid cars, launched in the early 1990s, to be accepted here as reliable vehicles; Electric vehicles have been around for less than 10 years.
The electric car population on the road in January 2020 was about 1,125, less than 0.2% of the total private car population. Tang said this is partly because the government is not really pushing EVs, and the conditions for their widespread adoption have not yet been set.
“People who live in real estate, buying their second car, are likely to be able to afford electric vehicles and have access to charging points. There is also the added concern that people who want to drive their cars to Malaysia when the reopening of borders will not be able to do it without charging points there ”, he said.
The government’s goal is to have 60,000 charging points by 2030. There are currently around 1,800, and private companies are connected to help speed up the process.
According to an International Energy Agency report released last year, worldwide electric car sales in 2019 exceeded 2.1 million units, increasing by 40 percent from the previous year.
Dr Timothy Wong, a senior lecturer in the department of economics at the National University of Singapore (NUS) Faculty of Arts and Social Sciences, said the one-year road tax refund would make any switch to electric vehicles was insignificant for now.
He said the average private car driver will likely pay $ 60 to $ 100 more a year for gasoline, an increase that will be offset by road tax rebates on the order of $ 40 to $ 50.
“He comes off just a little less well off. What (the gas tax increases) will do is take drivers away from taking more car trips a little bit. Drivers who currently take a lot of trips may not drive for less essential activities. “, He said. .
CIMB economist Song Seng Wun said the government’s move reads: “Make no mistake, this is where we are headed in the next few years.”
He said: “There is no good time to increase gasoline prices. It sets the backdrop for more sustainable cars to be the future and Singapore, being Singapore, will refine the policy as we move forward.”
NUS transportation infrastructure expert Raymond Ong said that along with other punitive measures for gasoline car owners and rebates for cars that use cleaner energy, the current cost advantage of purchasing gasoline powered vehicles will be reduced. internal combustion.
“This will make users who are already cost sensitive, which is the majority of drivers and companies that own fleets of vehicles, think twice before investing in vehicles with internal combustion engines,” he said.
He added that the policy change is necessary to help Singapore reduce its carbon footprint.
“Gasoline consumption has been relatively stable over the years, but the high amounts are not helping to address Singapore’s long-term targets for carbon emission targets.
“They are needed to ensure Singapore meets its carbon emissions target.”
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