U.K. Extends Subsidies for Buyers of Greenest Cars

The U.K. government announces a long-term extension to the plug-in car grant, backed by a £400 million ($595 million) package.

With the grant to continue from the previous deadline of February 2016 until at least the end of March 2018, the government says this will mean more than 100,000 people will benefit – double the number who have claimed the grant since 2011.

Announcing the extension, Transport Minister Andrew Jones says it means from next March, buyers of the greenest cars can save up to £4,500 ($6,696) on the overall purchase price.

“The U.K. is a world leader in the uptake of low-emission vehicles and the plug-in car grant has been key to that success,” Jones says in a statement.

“We are determined to keep Britain at the forefront of the technology, increasing our support for plug-in vehicles to £600 million ($893 million) over the next five years to cut emissions, create jobs and support our cutting-edge industries.”

Nissan GB Managing Director Jim Wright says the decision reaffirms the government’s commitment to the uptake of ultra-low-emissions vehicles.

“This announcement, together with ongoing infrastructure developments, should see the growth and wider deployment of this technology continue,” he says.

The grant was created in 2011 to encourage sales of ultra-low-emissions vehicles and has been instrumental in the U.K. becoming the biggest ULEV market in the European Union, and the fourth-largest in the world. Some 50,000 people have received the grant.

From next March, vehicles with a zero-emissions range of more than 70 miles (112 km) will benefit from a grant of £4,500. Vehicles with a shorter zero-emissions range, such as plug-in hybrid vehicles with a gasoline or diesel engine, will receive £2,500 ($3,720).

Sales of ULEVs have doubled over the past year with motorists having a choice of 29 ULEVs on the market, five times as many as when the plug-in car grant was launched.

The U.K. is also at the forefront of the rollout of hydrogen-fuel-cell vehicles, which also are eligible for the £4,500 grant thanks to their zero tailpipe emissions.

The government also says it will continue to provide a grant to help ULEV owners have a dedicated charge point installed at their home. From next March, the electric-vehicle home-charge scheme will offer £500 ($744) an installation, on average about half of the cost.

“To encourage zero-emission vehicles and maximize the number of everyday motorists who can benefit from government support, a price cap will also be introduced from March 1,” the government statement says.

Models with a list price of more than £60,000 ($89,281) will not be eligible for the grant, but all vehicles with a zero-emissions range of more than 70 miles (113 km) will be eligible for the full £4,500 grant.