Personal vehicle ownership — cars account for about 59% of the overall CO2 emission from transportation.
Malaysia wants all new vehicles entering the domestic market to be energy-efficient vehicles (EEVs) by 2025. According to the Malaysian Automotive Institute (MAI), this would ensure lower fossil fuel consumption and consequently lower carbon emission, the Sun Daily reported.
For perspective, the EEV penetration in Malaysia last year was 42.8%. MAI expects that to hit 50% in 2017 and 80% by 2020.
However, the 100% target may not be as daunting as it seems at first glance. MAI says car manufacturers are aggressively reconfiguring their business plans to align with the Malaysia National Automotive Policy (NAP) 2014 which aims to make Malaysia a regional EEV hub.
Read Thailand’s Electric Vehicles Initiatives
The question, however, is whether Malaysia can reach its greenhouse gas (GHG) emission targets. Recall that in December 2015, the Prime Minister pledged a 45% reduction in emissions by 2030 following the Paris climate deal.
What is Energy Efficient Vehicle (EEV)?
Based on global practice, EEV is defined as vehicles that meet a set of specification in terms of:
- Carbon emission level (CO2/km)
- Fuel consumption (L/km).
- EEV includes fuel-efficient internal combustion engine (ICE) vehicles, hybrid, electric vehicles (EV)
- Alternative fuelled vehicles such as Compressed Natural Gas (CNG), Liquefied Petroleum Gas (LPG), Biodiesel, Ethanol, Hydrogen and Fuel Cell.
The EEV technical specification for fuel consumption is determined based on international benchmarking across developed countries (Europe, United States of America, China, Japan, South Korea, Thailand and Taiwan) and in consultation with the Malaysian automotive industry.
Malaysia’s classification of EEV is based on fuel consumption specification. Carbon emission will only be used once the EURO 4M fuel quality standard is introduced. Malaysia has set a timeline of October 1, 2018 to implement Euro 4M gasoline specifications for the 95 RON grade in the country, according to a Malaysian government official.
Go EEV or EV?
While EEVs consume less fossil fuel than non-EEVs, they still do whereas Electric Vehicles (EVs) do not at all. In theory, this presents EVs as a superior choice in view of the 45% reduction goal. The government also has Malaysian Green Technology Corporation, which is mandated to promote EVs and aims to have 100,000 EVs on Malaysian roads by 2020.
That said, the focus on EEVs is a more natural choice for several reasons.
First, an EEV push is easier to support from the government’s perspective. Precedents in other countries have shown that for a mass shift into EVs to be accomplished, the market requires heavy incentives and subsidies — otherwise, mass adoption would not happen rapidly.
However, amid rapid urbanisation, the government has instead committed substantial funding to expand and enhance the land public transportation (LPT) network in a push to make LPT a feasible and preferred option for at least 80% of the urban population by 2030.
Second, from a consumer perspective personal mobility remains critical. With geographical limitations of the public transport network, people in places with limited access to the network still need personal vehicles to get around.
This means Malaysia needs a path forward that accommodates both the emissions reduction target as well as addressing the importance of personal mobility.
The natural choice is EEVs, which gives rise to the third reason: it is more accommodative for the existing automotive industry.
Car manufacturers can adjust their internal combustion engine-powered models to EEV requirements more easily than coming up with new models using the electric drive train.
EVs will Hurt Local Auto Makers
In other words, an immediate pursuit of EV-only initiative will hurt local auto manufacturers — an important strategic industry that employs 550,000 workers and contributed around RM30 billion to national gross domestic product (GDP) in 2013.
MAI expects the GDP contribution to hit RM120 billion or about 10% by 2020 with about 1.15 million vehicles manufactured in the country.
However, an immediate wave of initiatives for EVs would encourage more imports. They may also encourage Malaysians to opt for competitively priced imported EVs over locally manufactured EEVs, which would be bad news for the local auto sector.
So the EEV push represents a win-win-win that addresses the three concerns. However, only time will tell whether this will be enough to achieve Malaysia’s emissions cut target by 2030.