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Electric car grant slashed – again

Emma Lunn
Written By:
Emma Lunn

The government has reduced grants for electric vehicles for second time in a year, with the subsidy falling from £2,500 to £1,500.

This is half the sum available to buyers at the start of the year – it was also reduced in March.

The plug-in car grant (PiCG) offers a discount on the cost of buying an electric car. The scheme means the government puts a sum of money towards the purchase of zero-emissions vehicles, creating a cash incentive for buyers to switch to electric vehicles.

Previously buyers could get £3,000 off vehicles – this was reduced to £2,500 in March and has now been reduced to £1,500. The maximum price of vehicles that could be bought using the grant was initially £50,000, but this reduced to £35,000 in March and has now been cut to £32,000. The changes to the scheme take effect straight away.

The government said that as sales of plug-in cars, vans and motorcycles increase, the grant scheme for zero-emission vehicles has been updated to target less expensive models. It says this will allow the scheme’s funding to go further and to help more people make the switch to an electric vehicle.

Support for wheelchair accessible vehicles is being prioritised, with these retaining the £2,500 grant and a higher £35,000 price cap.

Grant rates for the Plug in Van Grant will now be £5,000 for large vans and £2,500 for small vans, with a limit of 1,000 per customer per year. This government says this will enable a more sustainable grant scheme and will ensure that taxpayers’ money is distributed more fairly across businesses seeking to transition their vehicles to zero emission.

Motorcycle and moped grants will also be changing, with the government now providing £500 off the cost of a motorcycle, and £150 for mopeds, with a price cap on vehicles of £10,000.

Trudy Harrison, transport minister, said: “The market is charging ahead in the switch to electric vehicles. This, together with the increasing choice of new vehicles and growing demand from customers, means that we are refocusing our vehicle grants on the more affordable vehicles and reducing grant rates to allow more people to benefit, and enable taxpayers’ money to go further.

“We want as many people as possible to be able to make the switch to an electric vehicle, which is why we will also be introducing new rules to make it easier to find and pay at chargepoints. This will ensure drivers have confidence in our charging infrastructure, as we look to reduce our carbon emissions, create green jobs and level up right across the UK.”

Louise Haigh MP, Labour’s shadow transport secretary, said: “Families are facing an inflation bombshell, and this cut in support will put electric vehicles out of reach for many. There is no path to net zero without affordable green transport, and this foolish decision – which comes just weeks after the prime minister promised action on polluting cars at COP26 – shows the government simply are not serious about tackling the climate crisis.

“Labour would bring forward ambitious proposals to spark an electric vehicle revolution in every part of the country. By extending the option to buy an electric car to those on lower incomes and accelerating the rollout of charging points in regions that have been left out, we would ensure that everyone can benefit from the green transport revolution.”