CVES incentive for Band A models and ETS for HCVs extended to improve Singapore’s air quality, moving towards the vision to have all vehicles run on cleaner energy by 2040
JOINT NEWS RELEASE BETWEEN NEA AND LTA
Singapore, 30 December 2024 – To continue encouraging the adoption of cleaner commercial vehicles, incentives for vehicles in Band A under the Commercial Vehicle Emissions Scheme (CVES) will be extended for two years from 1 April 2025 till 31 March 2027. The Early Turnover Scheme (ETS) will be extended for Heavy Commercial Vehicles (HCVs) till 31 December 2025.
Adjustments to Commercial Vehicle Emissions Scheme (CVES)
2 In April 2021, the CVES was introduced to encourage the adoption of cleaner light commercial vehicles (LCVs). The CVES applies to all new and used imported LCVs, including Light Goods Vehicles, Goods-Cum-Passenger Vehicles, and small buses, with maximum laden weight not exceeding 3,500kg. Under CVES, vehicles are classified into bands based on their worst-performing pollutant among the following: carbon dioxide (CO2) [1], hydrocarbons (HC), carbon monoxide (CO), nitrogen oxides (NOx) and particulate matter (PM) emissions. The vehicles are then granted an incentive or are subject to a surcharge, based on the band they are in.
3 To continue encouraging the adoption of cleaner commercial vehicles, the CVES will be extended for two years till 31 March 2027. The incentive for commercial vehicles in Band A (electric vehicles) will remain at $15,000, while incentive for Band B (mainly petrol vehicles) will be removed. The surcharge for Band C (mainly diesel vehicles) will be raised from the current $15,000 to $20,000. These changes are in line with the Government’s vision to have all vehicles run on cleaner energy by 2040. Details of the adjustments to the incentive and surcharge for CVES are in Annex A.
4 There are more Band A LCVs available on the market currently, compared to 2021 when CVES was first introduced. Band A LCVs are assessed to have the lowest total cost of ownership among the three Bands over the vehicle’s lifespan [2]. The most pollutive vehicles, i.e. in Band C, typically incur the highest total cost of ownership after applying the CVES surcharge. The comparison of the total cost of ownership between Band A, B and C LCVs is shown in Annex B.
Extension of Early Turnover Scheme (ETS) for Heavy Commercial Vehicles (HCVs)
5 The ETS was introduced in April 2013 to promote the replacement of older, more pollutive diesel commercial vehicles and buses. The ETS provides a discount off the Prevailing Quota Premium [3] when owners of older diesel commercial vehicles and buses switch to cleaner new vehicles.
6 The ETS for HCVs, including Heavy Goods Vehicles, Very Heavy Goods Vehicles, Goods-Cum-Passenger Vehicles and buses, with maximum laden weight exceeding 3,500kg, will be extended till 31 December 2025 and will cease thereafter. There is no change to the ETS incentive quanta for HCVs. Details of the ETS incentives for HCVs are in Annex C. The Government is studying other means to promote cleaner HCVs.
7 As announced on 15 November 2022, the ETS for LCVs will cease after 31 March 2025.
8 As of September 2024, around 70,000 vehicles eligible under the ETS scheme have been replaced with cleaner models.
9 Since the implementation of the CVES, coupled with ETS, about 80 per cent of LCVs registered from April 2021 to September 2024 were of cleaner models.
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[1] To account for the CO2 emissions produced by electricity generation from fossil fuels, an emission factor will continue to be applied to the electricity consumption of electric vehicles (EVs) and plug-in hybrid electric vehicles (PHEVs). The emissions factor (EF) for electric and plug-in hybrid cars will remain unchanged at 0.4g CO2/Wh of electricity till 31 December 2025.
[2] The cost per km of electricity to run an electric vehicle is cheaper than the cost per km of petrol or diesel needed.
[3] PQP is the amount of Quota Premium payable to extend or renew the Certificate of Entitlement (COE) of an existing in-use vehicle. It is based on the three-month moving average of Certificate of Entitlement (COE) prices (i.e. Quota Premium) for the past three months price, and there is no need for the owner to bid for a COE.
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Annex A
Changes in Incentive Quanta for Commercial Vehicle Emissions Scheme (CVES)
| Band | Current CVES (1 Apr 2023 – 31 Mar 2025) |
Adjusted CVES (1 Apr 2025 – 31 Mar 2027) |
|---|---|---|
| A* | $15,000 incentive | $15,000 incentive (no change) |
| B | $5,000 incentive | No incentive or surcharge |
| C^ | $15,000 surcharge | $20,000 surcharge |
*Disbursement of CVES Incentives
Band A incentive will be fully disbursed to the vehicle owner upon vehicle registration.
^Imposition of CVES surcharge
For Band C vehicles, the surcharge will be imposed upon vehicle registration.
Pollutant Thresholds for CVES (No change from 1 Apr 2023)
Annex B
Total Cost of Ownership Comparison for Commercial Vehicle Emissions Scheme (CVES) Bands A, B and C Vehicles
(Based on Available Estimates for Popular Models as of Dec 2024)
| Band A (e.g. electric) |
Band B (e.g. petrol) |
Band C (e.g. diesel) |
|
|---|---|---|---|
| Average Upfront Cost (excluding COE) |
$56,900 | $28,800 | $62,100 |
| Average Upfront Cost (excluding COE) (After CVES) |
$41,900 | $28,800 | $82,100 |
| Lifecycle Costs (LCC)[1] over 10 years |
$81,400 | $118,700 | $88,800 |
| Total Cost of Ownership over 10 years (Before CVES) |
$138,300 | $147,500 | $150,900 |
| Total Cost of Ownership over 10 years (After CVES) |
$123,300 | $147,500 | $170,900 |
[1] Lifecycle costs refer to running and maintenance costs such as road taxes, fuel costs, servicing costs.
Annex C
Incentive Quanta for Early Turnover Scheme (ETS) for Heavy Commercial Vehicles (HCVs)
[1] Tailpipe emissions refer to air pollutants HC, CO, NOx and PM.
[2] The same incentive applies if replacement vehicle is an HCV without tailpipe emissions. Owners who replace an existing LCV with an HCV with tailpipe emissions do not qualify for the ETS incentive.
[3] The same incentive applies if replacement vehicle is a Band A LCV under the CVES.
[4] The same incentive applies if replacement vehicle is a Band B LCV under the CVES.
Annex D
Examples of available LCV models under CVES (Based on Available Information[1])
| Band | Vehicle Models |
|---|---|
| A | BYD T3, DFSK EC35, DFSK EC31, Maxus e-Deliver 3, Opel Combo-E, Citroen E-Berlingo, Golden Dragon EV ABS Van, Opel E-Vivaro, Foton Iblue V6, Citroen Electric Dispatch, Mercedes e-Vito |
| B | Honda N Van Style Fun, Suzuki Spacia Base, Nissan NV200, Toyota Town Ace 1.5GL Auto |
| C | Toyota Hiace Van, Peugeot Partner 1.5 BlueHDI, Nissan NV350 Diesel, Toyota Hiace 2.8 DX, Mercedes Vito 114 |
|
Legend A – Electric B – Petrol C – Diesel |
Annex E
Adjusted Early Turnover Scheme (With effect from 1 April 2025)
- To be eligible for the scheme, the following criteria must be met:
(I) The existing vehicle must be:
- A Category C vehicle
- Not COE-exempted;
- Propelled by diesel, diesel-Compressed Natural Gas (CNG) or diesel-electric;
- Under the permanent ownership of the registered owner;
- Registration and deregistration dates are within the following period:
Registration Date From 1 January 2001 to 31 December 2013 (inclusive) Deregistration Date From 1 April 2025 to 31 December 2025 (inclusive)
- Properly disposed of (i.e. scrapped or exported and COE rebate, if any, successfully granted) before registration of the replacement vehicle; and
- Have at least one day of COE life remaining or at least one day of its remaining statutory lifespan, at the point of deregistration.
(II) The replacement vehicle must be:
- Not COE-exempted.
- A vehicle that meets Euro 6 or equivalent emission standards
- Registered in the name of the last registered owner of the existing vehicle [1]; and
- Registered within 1 month from the date of deregistration of the existing vehicle.
See illustrations:
| For existing vehicle registered on or after 1 January 2001 to 31 December 2013 | · If deregistered on 1 August 2025, the replacement vehicle must be registered by 31 August 2025. · As scheme ends on 31 December 2025, the last date to deregister will therefore be 31 December 2025 and its replacement vehicle must be registered by 31 January 2026. |
2. The details of the 2 components of the scheme are as follow:
a) COE transfer. This will allow a transfer of the remaining COE validity period from an eligible vehicle to a new Euro 6-compliant vehicle.
b) COE bonus. This is based on the remainder of the vehicles’ 20-year lifespan and structured as follows [2] in Annex C.
[1] Vehicle owners who wish to transfer their replacement vehicle to another owner can apply to LTA to effect the ownership transfer after registration of the replacement vehicle. Visit www.onemotoring.com.sg for vehicle ownership transfer procedures and forms.
[2] The bonus COE period would carry zero financial value. The cash value of the full 10-year COE for the replacement vehicle would be the transferred value of the remaining COE life of the existing vehicle (based on the old COE price) and the amount paid for the PQP top-up.
Annex F
Summary on Prevailing Quota Premium (PQP) Payable and Calculation of COE
(A) How PQP Payable for the Replacement Vehicle is Derived
For eligible vehicles that are deregistered under the scheme, the discounted PQP payable at
the point of registration of the replacement vehicle will be computed as follows and rounded
up to the nearest dollar.
* Refer to Table in Annex C
(B) How the Value of the 10-year COE for the Replacement Vehicle is Calculated
Once registered, the value of the 10-year COE for the replacement vehicle will be calculated as follows:
| Value of 10-year COE of the replacement vehicle | = | Discounted PQP paid at registration | + |
COE rebate granted to existing vehicle at deregistration, if any |
