Published on 27 Aug 2021

Climate-friendly Singapore CEO junks his Porsche and Ferrari

The chief executive of homegrown fintech M-DAQ Richard Koh is a longtime car aficionado. But his choice of ride has changed markedly in recent years. Over the last two years, the 48-year-old has switched his luxury gas-guzzlers - the likes of Porsche 911 Carrera 4S and Ferrari California T - for climate-friendly electric cars.

His family currently owns an MG electric sports utility vehicle and the first BMW iX3 to ply Singapore roads.

This switch comes about eight years after he decided to power his semi-detached home entirely via solar energy, a move for the environment which his family and his neighbours - after he successfully persuaded them to follow suit - have also reaped the benefits of.

While countries and organisations worldwide are sounding their commitment to carbon neutrality, wherein there is no net increase in carbon dioxide emissions, Mr Koh's solar home is carbon negative. Not only does it produce enough energy to power daily household activities, the family sells excess solar electricity to the grid.

Mr Koh said his advocacy stems from a belief that the remedy to many of the world's pressing problems, including climate change, and the lack of sanitation and nutrition, lies in renewable energy.

"To me, energy is a common denominator in all these problems our world is facing now and in the future, whether it's water, clean air, food... The world has an abundance of renewable energy, it's very cheap, and it can solve many of our problems," said Mr Koh, who was speaking to The Business Times from the M-DAQ office in Tai Seng.

A stone's throw away at Novelty BizCentre, a freehold industrial building which M-DAQ also operates from, common areas are powered by solar energy - another result of Mr Koh's environmental crusade. As chairperson of the building's management committee, he spent several years persuading fellow subsidiary proprietors to go solar.

"For which other investment will you get a guaranteed 20 per cent return? Now, with solar panels, who is your counterparty? The sun. As long as you believe the sun is going to be there for the next 25 years, I think we will be fine. If somebody asks, what if the sun no longer shines? I think, then, we will have a bigger problem."

Others have flagged concerns about maintenance. "I say, there is nothing to maintain. The wind comes, the rain washes the dirt away, there's no need for cleaning. The panels at my home have been there for eight years and we have more than recovered their cost. And I've never once had to go up and do something about it, because there's no movable parts."

His solar-powered home generates about 100 kWh of electricity daily. Each month, he exports a net excess energy back to the grid.

It was only after three years that Mr Koh managed to garner a 75 per cent majority to pass a special resolution for common areas at Novelty BizCentre to be solar powered.

"Initially, everybody was saying, 'Oh, you want to save energy? Why not change your lights to LED lights?' But that doesn't change anything. Reducing consumption doesn't lead to significant change, how energy is generated is the key thing," he said.

214 solar panels were commissioned on the 11-storey light industrial building in July this year, generating an average 400 kWh of electricity daily.

With momentum building up around sustainability issues, Singapore has "very good opportunities" to act on its commitment to the Paris climate accord, Mr Koh said. The central aim of the landmark agreement signed in December 2015 is to strengthen global response to the threat of climate change by keeping global temperatures this century well below 2 degrees Celsius above pre-industrial levels, and to "endeavour to limit" them even further to 1.5 degrees Celsius.

But this effort cannot only involve installing solar panels on state-owned buildings. The private sector has to play its part too, he stressed, suggesting how policy can drive a shift toward renewables.

For instance, legislation could mandate that a certain proportion of energy used in private properties come from renewable sources. Mr Koh likens this to how the Building and Construction Authority's accessibility code mandates a certain number of parking lots for individuals with disabilities.

"Similarly, the URA (Urban Redevelopment Authority) could legislate that all new buildings must have 30 per cent of its common areas powered by renewable energy. Once the government legislates it, the private sector will take care of itself. It's just like if you don't legislate handicap loans, there will be none because they are neither space efficient nor economically productive," he said.

When it comes to electric vehicles (EVs), Mr Koh said that the current tiered road tax framework - where EVs with a power rating above 230 kW are subject to considerably higher taxes due to a different formula - is illogical and disincentivises those who would otherwise be early adopters of the greener cars.

The tiered framework is guided by a progressive tax structure, similar to the case for vehicles running on internal combustion engines (ICEs), where luxury models are more heavily taxed than mass market models.

Mr Koh maintains that the same approach cannot be applied to EVs, as cars with higher power ratings do not pollute more. In fact, higher power ratings translate to longer ranges, which means these EVs can travel for longer without recharging - and are in turn less of a strain to electric charging infrastructure.

The lack of charging infrastructure has often been cited as a pain point in Singapore's push for EVs. There are currently only about 2,000 EV charging points in Singapore. The government has plans to deploy 60,000 points across the country by 2030, of which two thirds will be in public car parks.

At the same time, it wants to have all ICE vehicles off the road by 2040.

Mr Koh thinks that 60,000 charging points will still not be able to service the needs of Singapore's entire vehicle population, which currently stands at about 900,000. Longer-range vehicles alleviate part of this conundrum because they have to be plugged in less frequently, he said, but the loftier tax is a turn-off.

"For many people who can afford luxury EVs, surely they can pay a bit more on road tax. So it is not a problem with affordability, but equity. There is no valid justification (for the higher tax). Having a bigger battery does not mean more pollution. Longer-range EVs also typically do not take up more space. We feel it is an unfair penalty, so we cannot bring ourselves to buy the longer-range vehicles. It should just be one flat tax rate," he said.

Mr Koh also suggested removing the additional flat fee levelled on EVs. Sized to partially recover for the fuel excise duties paid by ICE cars, this additional component will be phased in over three years - S$200 in 2021, S$400 in 2022 and S$700 from 2023 onwards.

"To me, this is like taxing non-smokers to recover duties you used to collect from cigarettes, because your policies to discourage smoking have become so successful. It is illogical.

"Many drivers who have the means to become early EV adopters are not doing it fast enough because they are upset with what they perceive as inequitable policies," he said.

Source: The Business Times