The Bulletin

China turns to subsidies to control pollution

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China has launched a new round of subsidies for alternative energy vehicles such as electric and fuel-cell cars, as the government faces mounting pressure to reduce air pollution.

The government will provide up to 60,000 yuan, or $9,800, toward the purchase of an all-electric passenger vehicle, according to a joint statement by the National Development and Reform Commission and the Ministry of Finance.

Conventional hybrid vehicles will not be included in the incentives program reported Bloomberg News. Fuel-cell vehicles powered by hydrogen are included for the first time.

Hybrid models running on a gasoline engine with a backup battery still qualify for lower incentives of 3,000 yuan under a different plan.

The incentives will be targeted at the three regions near city centers Beijing, Shanghai and Guangzhou, areas that have struggled to keep a lid on air pollution. The subsidies aim to boost ownership in electric vehicles, which has lagged in China because of the high cost of ownership as well as a lack of charging stations.

Air pollution in China is dramatically shortening the life expectancy of its residents, damaging its tourism industry and costing the government hundreds of billions of dollars to reverse the trend.

Officials in Beijing—a city that has recorded some of its worst smog levels ever—are considering a policy to impose a congestion fee for cars in the center of the city in 2014, a practice used in London, Milan and Tokyo.

The fee aims to cut levels of particulate matter with a diameter of 2.5 micrometers, known as PM2.5. Though small in size, PM2.5 packs a punch. As pollution, it can spread over a large surface area and is known to carry toxic heavy metals, chemicals and organic pollutants.

Photo of Beijing’s Second Ring Road by Flickr user Pedronet

— By on September 18, 2013, 5:13 AM PST

Kirsten Korosec

Contributing Editor

Kirsten Korosec has written for Technology Review, Marketing News, The Hill, BNET and Bloomberg News. She holds a degree from Northwestern University's Medill School of Journalism. She is based in Tucson, Arizona. Follow her on Twitter. Disclosure