SINGAPORE is an acknowledged leader in transport management - but its policy on
diesel-fuelled cars is increasingly looking antiquated.

While the Republic's Certificate-of-Entitlement (COE) quota system to control
vehicle growth and its Electronic Road Pricing (ERP) system to manage vehicle
usage have set the pace for other cities, Singapore is lagging behind in its
policies towards diesel-powered cars.

Singapore's rules for diesel engines were set many years ago when diesel was a
dirty fuel. The modern diesel engine and fuel is actually very clean, even
compared to gasoline engines.

Current policies, however, do not take that into account. While most commercial
vehicles are diesel-powered, few private passenger cars are, with owners
discouraged by high charges.

Private users of diesel-driven cars must pay a diesel tax on top of a road tax,
which is six times the road tax, or four times for a Euro IV-compliant diesel
car. Not surprisingly, only seven out of the 470,000 cars sold here last year
run on diesel. This is in sharp contrast to many developed countries, where
there is an even greater emphasis on being green. In Britain last week, the
government launched a major campaign to promote greener driving, and its
underlying message was that a diesel car was the best option as it would travel
at least 20 per cent further than a similar car using an equivalent amount of
fuel. Almost half the new passenger cars in Europe run on diesel.

It is notable that Japan, which has also frowned on diesel cars, has signalled
that it is now prepared to give diesel a second look, given the advancements
made in diesel technology. Diesel-powered cars, of course, are not the only
alternatives to petrol-driven cars.

Hybrid vehicle technology, which couples the internal combustion engine with an
electric motor, will play an increasingly important role as costs come down and
as hybrid technology becomes available on a broader range of vehicles.

And the government here has been receptive of hybrids and other vehicles
powered by alternative fuels. It offers a Green Vehicle Rebate worth 40 per
cent of the Open Market Value (OMV) - or the base value - of a vehicle that can
be used to offset the upfront taxes, in order to help motorists who are willing
to switch to environmentally friendly vehicles, such as CNG, electric and
petrol-electric hybrid cars.

But it can be argued that diesel-fuelled cars, because they are far more
advanced in development compared to hybrids or other alternative fuel-driven
vehicles, offer the best immediate alternative to petrol-driven cars. Indeed,
major manufacturers like BMW, Mercedes and Audi have taken the diesel engine to
petrol-beating heights. New-generation diesel engines are not only as clean as
petrol engines but also more efficient.

Singapore - which prides itself in having a flexible policy-making regime that
keeps pace with changing developments - should consider re-evaluating its stand
on diesel.