The Land Transport Authority (LTA) has announced the injection of 20,000 additional certificates of entitlement (COEs) to spread over the next few years from February 2025. LTA in Singapore plans to release an extra 20,000 COEs in five vehicle categories starting from February 2025. These changes happened because travel behaviors have changed a lot, dropping about 6% in the overall distance traveled by vehicles between 2019 and 2023.
According to CNA, introducing the new version of the satellite Electronic Road Pricing (ERP) system, ERP 2.0, is anticipated to help better management of traffic congestion and vehicle usage through the incorporation of innovative “virtual gantries.” Although the intention behind injecting more COEs is to increase the supply, the effect on premiums is still unknown.
Recent data from sources indicates that COE prices saw a minor decrease across all segments in the most recent bidding exercise on October 23. Even with the decrease, insurance rates for both types of vehicles stayed above $100,000. As of September 2024, Singapore currently has around 1,003,126 vehicles in circulation.
The LTA will distribute the extra 20,000 COEs after reviewing traffic data and deregistration rates for different vehicle categories. The authority also understand the possibility of more COE injections into the vehicle population in the future, as more data and tools are made accessible under ERP 2.0.
The LTA stressed that the forthcoming COE supply reflects the government’s aim of becoming more “car-lite,” with a focus on encouraging walking, cycling, and public transportation. The zero vehicle growth rate for cars and motorcycles will remain unchanged until January 31, 2028, while the growth rate for commercial vehicles will stay at 0.25% per year from February 1, 2025, to January 31, 2028.
The organization reiterates its dedication to utilizing ERP 2.0 for implementing new initiatives like distance-based fees to better manage vehicle usage and address traffic congestion promptly. Equipping all vehicles with on-board units (OBUs) will help improve traffic management. Moreover, steps have been taken to maintain a stable COE supply despite soaring premiums, highlighting the LTA’s proactive stance in ensuring a sustainable and effective transportation environment.