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LCQ5: Incentive Scheme for Replacing pre-Euro and Euro I Diesel Commercial Vehicles
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    Following is a question by the Hon Lau Kong-wah and a reply by the Secretary for the Environment, Mr Edward Yau, in the Legislative Council today (June 11):

Question:

    In order to alleviate the problem of air pollution in Hong Kong, the Government launched a scheme on April 1 last year to subsidise owners of over 70 000 pre-Euro and Euro I diesel commercial vehicles in Hong Kong to replace their old vehicles with new ones which comply with the prevailing Euro IV emission standards.  In this connection, will the Government inform this Council:

(a) given that according to the information provided by the authorities to this Council's Panel on Environmental Affairs, up to end of April 2008, the Government approved 5,355 applications made under the above scheme, of the respective percentages of the numbers of various classes of vehicles involved in such applications, in the total numbers of eligible vehicles concerned;

(b) whether it has reviewed the effectiveness of the above scheme since its launch (including whether, given the trade's worry that replacement of vehicles may add to their burden, the amount of the grants concerned can attract more owners of heavy goods vehicles to participate in the scheme); and

(c) whether it has estimated, among those eligible commercial vehicles under the above scheme, the current number of vehicles (including goods vehicles and coaches) which travel between Hong Kong and the Mainland; given that diesel suitable for use by Euro IV vehicles is currently not sold on the Mainland, thus posing difficulties to owners of commercial vehicles travelling between Hong Kong and the Mainland who intend to participate in the above scheme for replacement of their vehicles, whether the authorities will explore with the mainland authorities a timetable for bringing in such diesel on the Mainland and review the incentive periods (particularly that for owners of long-haul coaches) of the above scheme so as to tie in with the timetable?

Reply:

Madam President,

(a) The incentive scheme has been implemented since April 1, 2007.  As at the end of April 2008, the Government approved 5,355 applications for the grants for replacing pre-Euro (i.e. older vehicles) and Euro I diesel vehicles.  The replacement was mainly pre-Euro diesel vehicles which accounted for about 70% of the total vehicles approved.  The number of vehicles involved in different classes and their percentage as compared to the number of eligible vehicles are given at Annex 1.

(b) Participation in the incentive scheme is entirely voluntary.  Owners of heavy goods vehicles or other diesel commercial vehicles alike will decide whether to make use of the scheme to replace their pre-Euro and Euro I diesel commercial vehicles based mainly on their financial position and their views on the business outlook.  As heavy goods vehicles are more expensive, it is totally understandable if vehicle owners are more cautious in deciding whether to replace their vehicles.

    In the past two months, the number of approved applications for the grants showed a rising trend, with the average number of approvals per month increased from 388 in the first year of the incentive scheme to 696 and 615 in April and May 2008 respectively.  The vehicles approved in these two months involved vehicles of various classes, with about 70% being pre-Euro vehicles.

    Accelerating the phasing out of the pre-Euro and Euro I diesel commercial vehicles will help bring early improvement to the roadside air quality.  The duration for the grant for Euro I vehicles is 3 years and they still have 21 months from the application deadline.  Whereas, that for pre-Euro vehicles is 18 months, and the application deadline is September 30, 2008.  As the application deadline for pre-Euro vehicles is closing, their application number has increased in the past two months.  We will continue to encourage eligible vehicle owners to participate in the scheme.  Moreover, we will keep a close watch on the progress of vehicle replacement.  If necessary, we will explore further measures to accelerate the phasing out of old commercial diesel commercial vehicles, in particular per-Euro ones, to bring about an early improvement of roadside air quality.

(c) As at May this year, 5,288 goods vehicles and 26 coaches travelling between Hong Kong and the Mainland are eligible for the above incentive scheme, making up about 9% of all eligible vehicles.

    Using Mainland diesel will not affect the operation of Euro IV diesel vehicles.  Mainland motor vehicle diesel differs from our local motor vehicle diesel in their sulphur content.  At present, National III standard diesel (sulphur content under 0.035%) is available at all filling stations in Shenzhen. When using Mainland motor vehicle diesel, Euro IV diesel vehicles emit about 5% more suspended particulates but their engines will not be damaged.  Once they switch to local motor vehicle diesel, their particulate emissions will decrease accordingly.  Hence, we consider it unnecessary to extend the duration of the incentive scheme for cross-boundary vehicles (including long-haul coaches).

    Just like Hong Kong, the Mainland has been committed to upgrading the quality of their motor vehicle diesel.  Apart from motor vehicle diesel with sulphur content not more than 0.035% (i.e. National III standard) being available at all filling stations in Shenzhen since April 2007, the Guangdong Provincial Government also announced in March this year that fuel oils of National IV standard (sulphur content not more than 0.005%, on a par with Euro IV standard) will be made available in Pearl River Delta Region by stages from October 1, 2009 onwards.

Ends/Wednesday, June 11, 2008
Issued at HKT 15:45

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