Government urged to offer incentives to green buses

Since August 29, HCM City has put 21 buses run on compressed natural gas (CNG) imported from South Korea into operation. Le Trung Tinh, Head of the Road Transport Management Division under the HCM City Transport Department, said that the decision was made after three years of preparation.

“The operation of the 21 green buses is the first step in the plan to use clean fuel buses. This aims to both save the energy and ensure a clean and green environment,” he said.

According to Le Hai Phong, Director of the Public Transport Management Center, the experiments show that CNG run buses have outstanding characteristics, in terms of the environment protection and fuel consumption reduction, in comparison with the normal buses run on diesel. The two buses run on the routes No 10 and 53 in the trial basis showed that CNG buses can save 30 percent of fuel. It costs 500,000 dong worth of fuel to run diesel buses, while took 340,000 dong only to use CNG.

Sources have said that the HCM City Transport Department plans to ask the city’s authorities to allow private businesses to run CNG buses as well, besides the Saigon Passenger Transport Company.

However, Phung Dang Hai, General Director of the HCM City Transport Cooperatives’ Federation, has warned that there are many problems existing, though he applauds the viewpoint on gradually replacing the current buses with CNG buses.

The problem is that state owned enterprises can enjoy many preferences, for example, they can borrow money at the zero interest rate, and enjoy import tax exemption, while private businesses cannot enjoy the preferences. Meanwhile, CNG buses are clearly more expensive than normal buses.

“We will spend money on purchasing buses, but we expect the subsidization for purchasing CNG,” he said. However, he has admitted that the HCM City Finance Department has not agreed to the proposal.

Explaining the refusal, an official of the HCM City Finance Department said that the department still does not have enough figures and information to consider the case, because the operation characteristics, fuel consumption level, maintenance fees of different kinds of vehicles are really different. Therefore, each of the means of public transport needs specific subsidization level.

The finance department believes that the best solution for now is to prop up the differences between the expenses for CNG and diesel, in order to encourage private businesses to equip with 50-100 more CNG buses every year.

Tinh also stressed that using green buses should be considered a big strategy. In Australia, the strategy has been implemented for a long time. Meanwhile, in South Korea, the government props up 22,000 dollars per bus when investors buy the green buses, props up 0.3 dollars per cubic meters of gas, while it exempts corporate income tax and VAT for the investors.

The information about the green buses has been applauded by HCM City’s dwellers. Nguyen Thi Kim Hong, a resident in district 10 said that a modern commercial hub like HCM City should not let the “dirty” businesses exist any more.

However, people have raised doubts about if the green buses can live for a long time. A bus driver said that in general, a bus can live for 20 years, but without the regular  maintenance, a bus could die at the age of 4 or 5.