MINDSETS take time to change, even if it concerns the preservation of the Earth. But advocates of environmentally friendly vehicles would have been encouraged by recent developments in Singapore, which, taken together, suggest that local motorists would no longer view the petrol-driven car as their de facto choice in the not-too-distant future.

Take the recent Budget, when the government announced a revised special tax structure for Euro IV private diesel cars from July 1. Currently, a private diesel car which complies with the stringent Euro IV emission standard has an annual road tax four times that of a normal car. This will be changed to an absolute-dollar tax based on the engine capacity of the car, at a rate of $1.25 per cubic centimetre of engine capacity, subject to a minimum tax of $1,250. The result is that it could reduce the tax for Euro IV diesel cars to about 2.7 times the normal road tax.

It's still not what diesel advocates are pushing for, which is tax parity with petrol-driven cars. It also means that only motorists who clock up high mileages would find it economically viable to switch to Euro IV diesel cars for the moment. But it still provides evidence that the long-held official view of diesel cars as dirty and pollutive is changing to take account of the advances in diesel technology. German car parts maker Bosch, for instance, has argued that motorists in Singapore will save more than $600 million worth of fuel a year if all cars here are diesel-driven.

Another encouraging development concerns compressed natural gas or CNG, an efficient and environmentally friendly fuel that emits less carbon monoxide, less hydrocarbon and nitrogen oxides, and practically no particulate matter. The problem with CNG is that it is not easily accessible here. Until recently, vehicles running on CNG had to travel to Jurong Island to refuel. The situation has improved slightly with Smart Energy opening its Mandai Link CNG refuelling station this month and planning to open another station in Serangoon North in September. SPC has also begun dispensing CNG at its petrol station at Jalan Buroh. With the availability of more refuelling stations, there is scope for the number of CNG vehicles here - currently at just over 500 - to grow.

That said, more needs to be done to encourage environmentally friendly motoring. While there is a role for the private sector to play, the small size of the Singapore market may deter the heavy investments required. The government will have to lead. It also means that the government should be prepared to do away with the diesel tax once more stringent Euro V standards are in place, so that it will encourage a level of demand that would encourage distributors to bring in diesel models.

And the green vehicle rebate, currently equivalent to 40 per cent of a car's Additional Registration Fee, should be made more generous. Singapore has long used the tax system to manage vehicle congestion. It should now be used more aggressively to put more environmentally friendly cars on the road.

This story was first published in The Business Times on Feb 26, 2008.