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Finance Committee of Legislative Council today (June 16) approved a new commitment of $725.52 million for providing a one-off grant to encourage diesel taxi owners to replace their vehicles with liquefied petroleum gas (LPG) vehicles.

A Government spokesman said that a one-off grant of $40,000 would be provided to each diesel taxi that was replaced by an LPG one.

"We plan to start taking in applications for the grant in August this year. We believe that the package of incentives that we are offering is sufficiently attractive," the spokesman said.

Based on the first year price cap of LPG of around $2 per litre at the five dedicated LPG filling stations, a taxi owner who has replaced his diesel taxi with an LPG one could save an average up to $45,000 a year on fuel cost.

The grant to assist taxi owners to replace their diesel taxis with LPG taxis forms part of the overall strategy to improve air quality.

The Government's policy is to replace diesel vehicles with cleaner alternatives wherever technologically practicable and available; adopt the most stringent vehicle and fuel standards; adopt practical technology to mitigate emissions from the existing vehicle fleet; and ensure proper maintenance of in-use vehicles through a combination of voluntary and regulatory measures.

Diesel vehicles are the dominant source of air pollution at the street level, accounting for 98 per cent of the respirable suspended particulates (RSP) and around 80 per cent of nitrogen oxides (NOx) emitted by vehicles.

The spokesman said that to protect public health, it was necessary to adopt all practical measures to reduce harmful emissions.

At present, there are about 18,000 diesel taxis in Hong Kong, contributing about 26 per cent of the RSP and 12 per cent of NOx emitted by the entire vehicle fleet.

The spokesman said that replacing all diesel taxis with LPG taxis would reduce RSP and NOx emissions by up to 25 per cent and 6 per cent respectively from the existing vehicle fleet.

"The objective of the scheme is to encourage all taxi owners to replace their diesel vehicles with LPG vehicles early, " the spokesman added.

"As regards the LPG filling facilities, our target remains to provide a capacity sufficient for about 8,000 taxis by the end of this year and for the entire taxi fleet by the end of 2001," he added.

End/Friday, June 16, 2000

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