The Ho Chi Minh City Department of Transport has proposed loan interest subsidies to implement a plan to invest more than 3.52 trillion VND in transitioning the entire public bus fleet to electric and clean energy by 2030.
Ho Chi Minh City aims to increase the total number of electric buses to 3,317 by 2030. Photo: Y Kien.
The Ho Chi Minh City Department of Transport (DoT) has sent a document to the Ho Chi Minh City Fatherland Front Committee, along with other departments, districts, and Thu Duc City, seeking input on a draft resolution by the City Council regarding the transition plan and policies to support the conversion of public passenger transport vehicles to electric and green energy buses in the city.
Specifically, the DoT is developing a project to control vehicle emissions in the city, with phase one focusing on transitioning public passenger transport vehicles to electric buses and green energy.
The DoT stated that this initiative stems from the current situation where Ho Chi Minh City and many other urban areas are facing increasing greenhouse gas emissions. The transport sector alone accounts for around 18% of the country’s total greenhouse gas emissions.
Worryingly, air pollution alone is causing approximately 60,000 deaths annually due to related illnesses. Major cities like Hanoi and Ho Chi Minh City are suffering from high levels of PM2.5 dust pollution, with estimated economic losses of $10.8-13.2 billion, equivalent to 5% of the national GDP.
Currently, Ho Chi Minh City has around 2,209 buses, of which 546 run on electricity and CNG, while the remaining 1,663 use diesel, resulting in a total CO2 emission of 553,299 tons per year. Between 2025 and 2030, the city plans to add 1,108 more buses, bringing the total to 3,317 by 2030.
The DoT emphasized that if the plan and supportive policies to transition public buses to electric or green energy are not quickly implemented, the city’s environmental pollution from traffic will worsen, harming public health and causing economic damage.
Therefore, the DoT proposed policies to support interest rate subsidies for investment in vehicle conversion. The goal is to provide a legal framework for loan interest rates and budgetary support to facilitate the transition from fossil fuels to electric and green energy vehicles.
Under the proposed plan, Ho Chi Minh City aims to invest more than 3.521 trillion VND to fully transition the public bus fleet to electric and clean energy by 2030.
Of this, 2.095 trillion VND will be allocated for vehicle investment loans, with an additional 79 billion VND for energy supply station investment. The remaining 1.347 trillion VND will be used to build electric charging stations.
For the vehicle conversion policy, the maximum loan amount is set at 85% of the total project investment. The maximum interest-supported loan is 300 billion VND per project, with a support period of up to 7 years.
Regarding charging station investment, businesses and economic organizations can borrow up to 70% of the total project investment. The maximum interest-supported loan for these projects is 200 billion VND.
The interest rate is calculated at 50% of the loan interest rate announced by the Ho Chi Minh City State Financial Investment Company for the loaned capital during the loan term. The city’s budget will cover the remaining 50% of the interest rate.
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Source: Vietnam Insider