A timely proposal

All right thinking readers would have greeted the good news from Thursday's Cabinet briefing where the Government announced it was planning to offer duty concessions for imports and local assembly of clean fuel vehicles.

Thus the excise duty structure is likely to be changed from 2009 to accommodate these timely proposals. This is a long-felt need as many other countries in our region have already taken this road years ago.

These proposals will be encouraging on two fronts: The public will get an opportunity to buy cheaper clean fuel vehicles and industrialists will be prompted to invest in the assembly of such vehicles locally.

This is a welcome move considering today's oil prices. Oil prices have come down right now, but there is no guarantee that they will remain that way.

There are several alternatives: Hybrids, electric and diesel. Yes, diesel is the fuel of the future. Today's diesel cars are clean and frugal. Sri Lanka's duty structure unfortunately discriminates against diesels, with duties of up to 500 per cent for passenger cars. We hope this will be rectified through the new proposals.

Oil is running out, but it will last for at least 100 more years. Consumers are trying to gain the maximum benefit from every drop of oil. Hybrids do just that.

Governments and regulatory authorities must encourage the use of hybrid vehicles by making it easier for consumers to buy them. This calls for duty and tax reductions to make them more affordable as outlined in these proposals.

Fuel efficiency is the answer. Hybrid cars, which combine a gasoline engine with electric motors, have become a viable alternative to gas guzzlers. The Toyota Prius and Honda's Civic IMA have literally led the charge, but other manufacturers are joining the fray almost every month.

It is worth granting duty concessions to electric and hybrid cars mainly because of their fuel-saving capacity. A hybrid car can do around 35 kilometres per litre, as against 18 Km per litre performed by even the most fuel efficient conventional gasoline engines.

Electric cars do not require fuel at all, but they have to be charged using the national grid, which depends mostly on fossil fuels anyway. Electric cars are also plagued by limited range and the need for large batteries. Scientists are striving to solve these problems. In the meantime, the advantage of hybrids is that they do not have to be recharged from mains electricity - braking the car generates power which charges the battery in a process called regenerative braking.

Another major benefit is that hybrids have very low emissions compared to conventional engined cars.

Some manufacturers are trying to build diesel hybrids, which will up the ante further. Today's best common rail diesel engines are already very frugal and clean, but combining one with an electric motor should be sweet music to motorists' ears.

Automakers are also looking at all-electric and hydrogen fuel-cell vehicles as an answer to the oil crisis. Several carmakers have released limited numbers of fuel cell versions of their popular vehicles. A couple of hydrogen filling stations have been opened in the US and Europe. Nevertheless, hydrogen-powered vehicles are at least a decade away from full commercialisation but our regulatory authorities should be alive to these developments.

Petrol cars are not going to disappear overnight, so the Government should encourage the purchase of smaller-engined petrol cars. Duty concessions could be granted for sub 1,000 CC cars and for smaller diesels such as 1.3 litre diesel cars.

The authorities should also encourage the local assembly of electric vehicles. There already are a couple of local companies making electric scooters. They should be given more concessions that will enable them to price their products aggressively.

They should also consider the possibility of getting down some alternative fuel buses for public transport. India and several other countries have natural gas and electric buses. This too may be costly initially, but the long-term benefits will outweigh such costs.

A better public transport system will help to keep at least some motorists away from their cars, benefitting the environment and the Exchequer.