100204EVreport

Making the EV Transformation in Hong Kong A Community Roundtable Thursday, 4 February, 2010

Table of Contents Acknowledgements................................................................................................................................. 1 Executive Summary................................................................................................................................. 2 Summary of the presentations, comments and Q & A session .............................................................. 3 1

Setting the Scene – A Policy Roadmap?...................................................................................... 3 1.1

Katharine Choi, Principal Assistant Secretary for the Environment (Energy), HKSAR Government ........................................................................................................................ 3

1.2

Updates from infrastructure providers and local EV designer ........................................... 3

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Connecting the Infrastructure .................................................................................................... 4

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Driving into the Future ................................................................................................................ 6 3.1

Marie Barbe Girard, Principal Associate, Commissioner’s Delivery Unit Transport for London ................................................................................................................................ 6

3.2

Prof. CC Chan, President, World Electric Vehicles Association ........................................... 6

3.3

Questions and answers session .......................................................................................... 7

Appendix I ............................................................................................................................................... 8

Acknowledgements Civic Exchange would like to thank the following people and organizations:      

British Consulate-General in Hong Kong for its generous support for this seminar; Ms Katharine Choi, Prof. CC Chan, Mr Ron Chung, Mr Michael Lee, Mr CT Wan, Ms MarieBarbe Girard for their presentations and comments; Michelle Wong for co-ordinating this event; Patrick WC Lau, Mike Kilburn and Yan-yan Yip for preparing this summary; Jonas Chau for preparing presentation materials; and Iris Chan, Patrick SY Lau and Rita Li for their assistance on the day.

Civic Exchange is a non-profit public policy think tank that helps improve policy and decision-making through research and analysis.

The opinions expressed in this report represent those of the speakers and participants and do not necessarily represent those of Civic Exchange. This summary is based on the presentations and discussions at the Seminar held on 4 February 2010.

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Executive Summary On 4 February 2010, over 60 participants attended a stakeholders’ workshop on electric vehicles (EVs) called “Making the EV Transformation in Hong Kong”, organized by Civic Exchange.

All around the world, cities are embarking on initiatives to realize the low carbon economy.

Transportation is one aspect of urban living that needs to be part of this transformation, as electric modes of transport powered by low- or no-carbon electricity may help put urban centres transportation onto a low carbon footing. Several large cities including Hong Kong and London are exploring EV options.

The workshop aimed to bring the main players in Hong Kong’s EV sector together to focus on the hard and soft supporting infrastructures required to roll out and accelerate the use of EVs in Hong Kong.

Speakers and commentators included:      

Ms Katharine Choi, Principal Assistant Secretary for the Environment (Energy), HKSAR Government Mr Ron Chung, Senior Strategic Planner (Marketing & Customer Services), CLP Holdings Ltd. Mr CT Wan, Director of Engineering (Planning & Development), Hongkong Electric Co., Ltd. Mr Michael Lee, Business Development Director, EuAuto Technology Limited (MyCar) Ms Marie-Barbe Girard, Principal Associate, Commissioner’s Delivery Unit Transport for London Prof. CC Chan, President, World Electric Vehicle Association

The range of participants included representatives from the power utilities, academics, vehicle distributors and manufacturers, technology developers, fleet owners, property developers and managers, and government. Two representatives from a technology developer travelled from Shenzhen to participate.

This report provides a summary of the presentations and discussions on the day. A copy of the programme is attached as Appendix 1. Speakers’ presentations are available for download at: http://www.civic-exchange.org/eng/event_100204EVworkshop.aspx

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Summary of the presentations, comments and Q & A session 1 Setting the Scene – A Policy Roadmap?

1.1 Katharine Choi, Principal Assistant Secretary for the Environment (Energy), HKSAR Government Ms Choi provided an outline of the Administration’s recent initiatives in four main areas:    

Extending the waiver on first registration tax for EVs to March 2014; Promoting the establishment of vehicle battery charging facilities; Close collaboration with EV manufacturers; and The establishment of a steering committee chaired by the Financial Secretary.

She noted that senior officials had proactively sought to secure vehicles for pilot projects from major manufacturers in Japan, China and Hong Kong, and commercial-scale production would begin to deliver larger volumes in 2011.

The first pilot charge points were already in operation in nine Government locations, two commercial parking facilities in retail developments and at a CLP office.

Ms Choi laid out a roadmap for the future development of electric transport in Hong Kong, indicating tasks that need to be accomplished in immediate, medium and long terms. Immediate tasks include enhancing collaboration with manufacturers to provide sufficient EVs for trial, actively engaging in the trial of EVs and developing the charging network.

When charting out the ways to embrace the global movement towards to green transportation, Ms Choi outlined specific tasks and identified the body responsible for their completion. The focus will be on securing higher numbers of a wider variety of models for the Hong Kong market, to promote research, development and manufacturing of EV technology in Hong Kong, and to actively promote EVs and educate the community on the opportunities and benefits of the use of EVs to stimulate a swift rate of adoption. Miss Choi’s presentation can be downloaded from the Civic Exchange website at: http://www.civic-exchange.org/eng/upload/files/100204KatharineChoi.pdf 1.2 Updates from infrastructure providers and local EV designer 1.2.1 Ron Chung, Electric Mobility Development Unit, CLP Holdings Ltd. Mr Chung noted the lack of controversy on EVs, while noting that roadside air quality remained a highly controversial issue. He said that the successful introduction of EVs would require good cars, infrastructure, policy, education and promotion.

He noted that CLP was both a user and facilitator of electric vehicles, including commercial buses, trucks and mini-vans, and that their 2.2 million-strong customer base provided a robust channel for outreach and education.

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He added that CLP was building an EV charging network in advance of the availability of the vehicles, with 21 stations planned, including in private car parks. CLP were actively collaborating with Hong Kong Electric Co. Ltd (HEC) in building a network with unified technology standards.

1.2.2 CT Wan, The Hongkong Electric Co. Ltd Mr Wan reaffirmed that air pollution was an important driver for EV implementation. He noted that HEC was addressing pollution by increasing the proportion of gas in its fuel mix from 15% to 30% (at the expense of coal) which would deliver 40 to 70% reductions in particulates. He affirmed his support for EVs as a measure to reduce both toxic and carbon emissions, noting that internal combustion engines operated at approximately 12% efficiency, while EVs were at 30%, and carbon emissions would be reduced by about 70%.

Mr. Wan also explained that where possible HEC would shift its fleet from hybrid to EVs, in line with Government plans for 20% of private cars to be EVs and noted that the introduction of 4,000 minibuses to electric vehicles would reduce emissions of nitrogen oxides by 300 tonnes.

HEC’s vision is to roll out a network of quick-charging facilities for EVs (using a system like the Octopus card), but warned that slower charging was better for the long-term health of the batteries.

1.2.3 Michael Lee, EuAuto Technology Limited Mr Lee noted that the principal concern of potential EV car buyers was running out of power and not having access to a filling station. He urged the rapid rollout of a widespread charging network, including at MTR stations, especially in new towns, and emphasized that EVs were an ideal solution for Hong Kong.

Mr Lee’s presentation can be downloaded from the Civic Exchange’s website at: http://www.civicexchange.org/eng/upload/files/100204MichaelLee.pdf

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2 Connecting the Infrastructure In this session, Christine Loh, CEO of Civic Exchange moderated a discussion in which participants explored the implications of EVs for property development and management. Some of the discussion highlights are noted below. 

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The costs and availability of vehicles and batteries is a major issue.

Interest and demand are high, but battery supply is creating the bottleneck. This has resulted in keen competition for even the few dozen pilot vehicles currently being manufactured for testing.

The following EVs will arrive in Hong Kong in the next few months: Seven electric trucks in early March 2010; a hybrid 3.5 ton truck at the end of March 2010; four light buses and two vans at the end of April 2010; and twenty units of a European sedan in June 2010.

HKPC is working on the development of an EV mini-bus and is collaborating with CLP on rolling out charging points, specifically the protocol (plug) between the car and the charge point.

Some participants were concerned that excessive regulation may restrict the rapid implementation of EVs in Hong Kong.

Many commercial vehicles are left-hand drive, while Hong Kong is in a minority as a righthand drive market, which would make Hong Kong a lower priority market for manufacturers.

The possibility of retrofitting commercial diesel vehicles as electric vehicles was raised.

Battery capacity remains a problem. The airport runs 81 electric tractors. Each tractor requires eight hours of charging for eight hours of use and each battery costs HK$60,000.

This translates to a requirement of 1.3-1.4 batteries per vehicle.

Property developers cannot install units to supply electricity under law unless they do not charge a fee. Another developer noted that 1-2 spaces had been allocated in several facilities, and requested incentives to stimulate greater provision. It was also noted that it would be difficult to secure approval to fit charge points in buildings with multiple ownership.

Concern was expressed about disposal of spent batteries. It was noted that all iMiEV batteries are recycled, and that revenue-generating opportunities exist for recyclers.

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3 Driving into the Future 3.1 Marie Barbe Girard, Principal Associate, Commissioner’s Delivery Unit Transport for London Ms Girard introduced London’s plan to transform itself into a low carbon economy, and goal to stabilize CO2 emissions at 60% below 1990 levels by 2025. An EV fleet powered by the London Grid would emit 40% less carbon than individually fuelled petrol and diesel cars.

A key consideration of this strategy is the growing EV market, which is expected to see the creation of 10,000 to 15,000 new jobs and become a £600 million business by 2025. The target set by the Mayor of London is to make London the EV capital of Europe with 100,000 EVs (5% of the total fleet) by 2020 and to have all Londoners within one mile of a charging point by 2015 (2,500 public charging points and a further 22,500 workplace charging points by 2015). Progressively faster charging would be introduced as the technologies matured.

Ms Girard noted that London was an ideal site for this transformation as it holds a high number of “early adopters” of new technologies, and many people traveling relatively small distances on a daily basis. She also noted the most important factor in building customer confidence was rapid rollout of the charging infrastructure and London’s initial aim is a ratio of one EV to one charging point. This was supported by £20 million in initial funding, plus attractive incentives such as exemption from the Congestion Charge, free electricity and free parking, plus substantial rebates and tax concessions.

The London-wide rollout was supported by careful demographic assessment, which highlighted Northwest, Southwest, and Central London as the heartland for early adopters.

Ms Girard also noted that, in addition to private cars, hybrid buses would be introduced at a rate of 500 to 700 per year from 2012, and there had been a strong expectation for Government bodies to take the lead in switching to an EV fleet.

Ms Girard’s presentation can be downloaded from the Civic Exchange’s website at: http://www.civic-exchange.org/eng/upload/files/100204Marie-Barbe.pdf 3.2 Prof. CC Chan, President, World Electric Vehicles Association Prof. Chan has been one of the leading voices in the development of EVs for several decades.

Despite noting several false starts he believes that the political and economic drivers and the technical expertise are all strong enough for EVs to finally take off. He noted that Hong Kong was an ideal market for EVs, being small in size and now enjoying solid commitments from government and the private sector. However, he believed that China and Japan would dominate in Asia.

Successful introduction of EVs requires four “goods”: 

Good products (power train technology, chassis & body technology, energy storage technology);

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Good infrastructure (charging points); and A good business model (involving close collaboration between government, energy suppliers, users, original equipment manufacturer (OEM) and key components suppliers).

He identified the development roadmap from combustion to long distance EVs as transitioning through “Prius” hybrid and plug-in hybrids before development of a robust long distance electrical powertrain.

Prof. Chan also touched on the underlying principles behind lithium ion batteries and developing the charging network into a distributed energy network, the differing investment paths of the US and Japan, and new trials in Singapore and China.

Prof. Chan’s presentation can be downloaded from the Civic Exchange’s website at: http://www.civic-exchange.org/eng/upload/files/100204ProfChan.pdf 3.3 Questions and answers session Some highlights from this session: Question: What was the process of putting together London’s EV transformation plan?

Marie-Barbe Girard: The overarching policy is set by the mayor’s office, implemented by Transport for London and business sector together. It was drafted and compiled with views and opinions from different sectors.

Question: To go from filling up at a gas station to plugging a power connection to each car is quite a big change in infrastructure. How does London plan to carry it out?

Marie-Barbe Girard: In terms of technology, we are getting closer to a rapid charger. In the long run, it will work much like today’s gas station, only they will be charging station. We are also working hard to change the mentality and behavior of Londoners.

Question: From a manufacturer’s point of view, is Hong Kong ideal for EVs? Response from the audience: Since Hong Kong is a small place, its driving range is ideal for EVs implementation. We are seeking breakthroughs in capacity and chemistry technology that will compensate the shortcomings of lack of charging points. There are lots of charging points in European cities, which are very supportive of this initiative, especially Paris. We believe that government support and infrastructure development will play a key role to the future.

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Appendix I Making the EV Transformation in Hong Kong Programme 4 February, 2010 Session 1: Setting the Scene – A Policy Roadmap?

2.05 – 2.20 Katharine Choi, Principal Assistant Secretary for the Environment (Energy), HKSAR Government 2.20 – 2.35

Updates from infrastructure providers and local EV designer: “What are we doing and what would enable us to move further?”

- Ron Chung, CLP Holdings Ltd. - CT Wan, The Hongkong Electric Co., Ltd. - Michael Lee, EuAuto Technology Limited (MyCar)

2.35 – 2.55

Feedback from other stakeholders Questions and comments

Session 2: Connecting the Infrastructure 2.55 – 3.15 Discussion with developers and property management companies 3.15 – 3.30

Questions and answers session

3.30 – 4.00

Afternoon tea

Session 3: Driving into the Future 4.00 – 4.20 International experience: London - Marie-Barbe Girard, Principal Associate, Commissioner’s Delivery Unit Transport for London Response from Prof. CC Chan, President, World Electric Vehicle Association 4.35 – 4.50

Questions and answers session

4.50 – 5.00

Close & thanks Next steps for Hong Kong and how to showcase at November conference

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