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February 26th, 2010:

2010 budget speech highlights: Promoting Green Economy

a world of green

Promoting Green Economy

89. In my last Budget, I proposed to promote a “green economy” and introduced a series of measures, including Hong Kong-Guangdong co-operation in environmental protection, the use of electric vehicles and promotion of green buildings. In his Policy Address, the Chief Executive further announced the development of environmental industries as one of the six industries and put forth initiatives in respect of the Cleaner Production Partnership Programme, the Clean Development Mechanism Projects, and Government Green Procurement. These initiatives have already been rolled out. In the next financial year, I will give further support in the following areas.

Pilot Green Transport Fund

91. To encourage the transport sector to test out green and low-carbon transport technology, I propose to set up a $300 million Pilot Green Transport Fund for application by the industry, initially by the public transport operators. I hope that this Fund will encourage the industry to introduce more innovative green technologies, such as the use of buses, public light buses, taxis, and ferries that employ green technologies, and help nurture the budding of green technology in Hong Kong.

92. The use of low-emission and energy saving transport will not only help improve roadside air quality, but also reduce carbon emissions and promote a low-carbon economy. I hope that the transport industry will actively try out innovative green technologies, contributing to better air quality and the health of people living in Hong Kong.

Phasing Out Old Diesel Commercial Vehicles

93. In 2007, the Government launched a scheme to subsidise the replacement of the more polluting pre-Euro and Euro I diesel commercial vehicles with newer models producing fewer emissions. The scheme will end this March. To continue to accelerate the phasing out of old diesel commercial vehicles, I will provide a 36-month subsidy scheme for the replacement of Euro II diesel commercial vehicles. The scheme will involve expenditure of about $540 million.

94. I also propose to accelerate the tax deduction for capital expenditure on environment-friendly vehicles. Enterprises can enjoy a 100 per cent profits tax deduction in the first year under the proposal. This will encourage the business sector to purchase more electric vehicles, hybrid vehicles and other environment-friendly commercial vehicles.

95. To promote the use of electric vehicles, I set up the Steering Committee on the Promotion of Electric Vehicles last April. The Committee has made a number of recommendations on the strategy and concrete measures for promoting electric vehicles. One of the recommendations is that the Government should take the lead in using more electric vehicles. We have procured 10 electric vehicles, and plan to purchase 10 to 20 such vehicles in each of the following few years. Besides, 10 electric motorcycles have been introduced into the Police fleet. In the private sector, the two power companies have placed orders for over 20 electric vehicles. Furthermore, around 200 electric vehicles will be supplied to the local market in the next financial year. We expect to see wider use of electric vehicles in Hong Kong in the year ahead.

96. We have made good progress in increasing charging facilities for electric vehicles. We have built charging stations in nine government car parks and will build more than 20 such stations this year. Apart from these, the two power companies have started building 28 charging stations in various car parks. The Electrical and Mechanical Services Department has also issued guidelines on the installation of charging facilities in car parks to encourage operators of private car parks to provide such facilities. The Government and the power companies will continue to expand the charging networks for electric vehicles.

What do you think about the government’s proposals? Sound off after the jump.