- £300 million in grant funding for sales of electric vans,
taxis and motorcycles to boost drive to net zero
- success in the UK’s electric car revolution leads the
government to refocus plug-in grant funding to encourage other
vehicles to ‘charge up and go green’
- part of government’s zero-emission travel plans, already
supported by generous electric car tax incentives and £2.5
billion investment
The government is today (14 June 2022) closing the plug-in car
grant scheme to new orders after successfully kickstarting the
UK’s electric car revolution and supporting the sale of nearly
half a million electric cars.
The scheme has succeeded in creating a mature market for
ultra-low emission vehicles, helping to increase the sales of
fully electric cars from less than 1,000 in 2011 to almost
100,000 in the first 5 months of 2022 alone.
Battery and hybrid electric vehicles (EVs) now make up more than half of all
new cars sold and fully electric car sales have risen by 70% in
the last year, now representing 1 in 6 new cars joining UK roads.
The government has always been clear the plug-in car grant was
temporary and previously confirmed funding until 2022-23.
Successive reductions in the size of the grant, and the number of
models it covers, have had little effect on rapidly accelerating
sales or on the continuously growing range of models being
manufactured.
Due to this, the government is now refocusing funding towards the
main barriers to the EV
transition, including public charging and supporting the purchase
of other road vehicles where the switch to electric requires
further development.
To continue the government’s drive towards net zero and ensure
effective use of taxpayer funds, £300 million in grant funding
will now be refocused towards extending plug-in grants to boost
sales of plug-in taxis, motorcycles, vans and trucks and
wheelchair accessible
vehicles, as announced in the autumn statement.
The shift in focus will also help allow government funding to
target expanding the public chargepoint network, helping to
eradicate “range anxiety” and ensure the transition to
zero-emission transport is easy and convenient for all drivers
across the UK. The government has already committed £1.6 billion to
building the UK’s public chargepoint network.
Significant savings in running costs for electric cars compared
to petrol or diesel equivalents can often exceed the current
£1,500 value of the grant, and electric car drivers will continue
to benefit from generous incentives including zero road tax and
favourable company car tax rates, which can save drivers over
£2,000 a year.
All existing applications for the grant will continue to be
honoured and where a car has been sold in the 2 working days
before the announcement, but an application for the grant from
dealerships has not yet been made, the sale will also still
qualify for the grant.
Transport Minister said:
The government continues to invest record amounts in the
transition to EVs, with
£2.5 billion injected since 2020, and has set the most ambitious
phase-out dates for new diesel and petrol sales of any major
country. But government funding must always be invested where it
has the highest impact if that success story is to continue.
Having successfully kickstarted the electric car market, we now
want to use plug-in grants to match that success across other
vehicle types, from taxis to delivery vans and everything in
between, to help make the switch to zero emission travel cheaper
and easier.
With billions of both government and industry investment
continuing to be pumped into the UK’s electric revolution, the
sale of electric vehicles is soaring.
We are continuing to lead the way in decarbonising transport,
with generous government incentives still in place, while
creating high-skilled jobs and cleaner air across the UK.
The government’s measures to support the uptake of electric cars
over the past decade have helped to exceed electric car
projections, with 39,000 new EV registrations in March 2022 – more
than in the whole of 2019. Since its inception in 2011, the
government’s plug-in car grant has provided over £1.4 billion and
supported the purchase of nearly half a million clean vehicles.
A new public evaluation
report has been published today highlighting while the
plug-in car grant was vital in building the early market for
electric vehicles, it has since been having less of an effect on
demand, with other existing price incentives such as company car
tax, continuing to have an important impact. The report also
found the plug-in van market will benefit from grant incentives
more to support businesses and their fleets in making the switch.
While benefitting from significantly lower running and refuelling
costs – as low as 2p per mile, EV drivers can also expect to see a
surge in cheaper, more reliable and quicker public chargepoints,
as the government delivers its commitment to install 10 times
more on-street chargers by 2030.
Since 2020, the government has committed £2.5 billion to plug-in
vehicle grants, infrastructure and the wider transition to
electric vehicles in the UK. The industry is further boosting
the switch to greener vehicles by expanding its range of more
affordable zero emission cars. A total of 24 models are currently
priced under £32,000, compared to just 15 a year ago, and the
cost of monthly purchase and rental schemes has fallen
significantly.
