Will shrinking cash incentives stop drivers going green?

Cash grants have seen the popularity of cheap-to-run electric cars soar over recent years. Could a review of these government incentives spell trouble for the plug-in car?

Image Credit: Omada/Getty Images

Robert Clymo - When the government offers us a cash incentive, most people are willing to consider whatever it has up its sleeve. Back in 2009, car owners were given a £1,000 government rebate for trading in their clapped-out vehicle for a shiny new one. Combining it with a like-for-like contribution from car dealerships meant that sizeable discounts could be had if you were willing to part with your ageing motor. As it turned out, the scheme was so successful that it was responsible for seeing many not-so-dilapidated cars taken off the road, too. The government wound the scrappage scheme up in March 2010, just a year after it was introduced.

The rise of the ULEV

It’s been a similar story with ultra-low-emission ‘plug-in’ vehicles (ULEVs). Their blossoming popularity is thanks, in part, to a cash grant that’s been offered since 2011: a grant of up to £5,000 for each vehicle sold. At the moment, there are a total of 50,000 plug-in grants to be given out.

And as our appetite for environmentally friendly cars increases, we’re getting close to hitting that limit. In March of this year, there were over 6,000 sold, compared to just 1,200 the year before. There could be 30,000 plug-in cars and vans sold in 2015 alone.

The electric car market is thriving, and manufacturers are getting better at making cars that meet the government’s grant eligibility rules, too. To qualify for a grant, the chassis and body of the vehicle have to meet strict standards, and there are rules about exhaust emissions, the range of the vehicle, battery performance and much more besides.

From May 2015, the government will review what kind of financial support will be available once all 50,000 grants have been given out. There will be help available once the cap is reached, with at least £200 million allocated to fund the plug-in grant from 2015 up to 2020. But even with this cash injection, it's possible that, with the market in such a robust state, government subsidies could be reduced.

Will we stop buying green cars?

Plenty of eco-conscious drivers are happy to drive a low-emission car simply because of its green credentials.

Not to mention the fact that they’re drastically cheaper to run than petrol-guzzling motors.

And, even if you don't make use of the government support, there are plenty of financial reasons for buying a ULEV. There’s road tax exemption, free access to London’s congestion zone, company car tax initiatives and a growing network of charging points that make the practical aspect of owning a plug-in car much more viable.

Vehicles are becoming quicker to charge too, with 500 so-called ‘fast chargers’ around the country pumping out a half charge in less than 20 minutes. Where once many of us were scared of buying a plug-in vehicle because of its lack of range, the new models that are on forecourts right now can go further than ever on one charge, and they perform better, too.

All in all, the cash incentives - in their current form - could only last for a few more months, until all 50,000 available grants have been taken. So, if you are thinking about buying an electric car, you might want to act sooner rather than later.

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