Government scraps plug-in car grant to focus on EV charging rollout

The government has scrapped its plug-in car grant scheme in order to focus on expanding electric vehicle charging infrastructure.

The grant was closed on Tuesday (14th June) with immediate effect, with the government saying it will instead concentrate the funding on expanding the public chargepoint network as well as electric taxis, vans, trucks, motorcycles and wheelchair accessible vehicles.

With prospective EV owners once able to claim up to £5,000 back as part of the scheme, it had since been reduced to £1,500, to help alleviate some of the costs associated with making the switch to an electric vehicle.

Announcing the decision, the Department for Transport (DfT) said the plug-in car grant was temporary and previously confirmed funding until 2022-23. It now says £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.

The DfT also claimed that 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.

Transport Minister, Trudy Harrison, 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.”

Mike Coulton, EV Consultant at Volkswagen Financial Services UK, said: “Whilst it should not come as a surprise to see the Government have brought to a close the Electric Vehicle Plug-In Car Grant (PICG), it is nonetheless hugely disappointing that more is not being done to encourage and support lower-income households in the transition to EVs.

“Maintaining or even increasing the PICG for the least expensive EVs to make them more affordable, and encourage manufacturers to produce electric cars at a lower price-point, could have been a strong incentive to help adoption for this sector of the market. This in turn would help to remove older and dirtier ICE (internal combustion engine) vehicles in the same way that scrappage schemes have successfully done in the past.

“That said, the Government’s focus on further improving public charging, whilst still incentivising adoption in other areas of the vehicle market such as LCVs is to be welcomed and encouraged. We would ask that further clarity is urgently provided in key areas, such as BIK rates beyond 2025, and a realignment of the AER rates to reflect the costs of charging an EV away from home, for those who cannot make use of a cheaper overnight electricity tariff.”

Joel Teague, CEO of Co Charger, an electric vehicle charger sharing app, also commented: “I feel a lot of sympathy for the automotive sector for another sudden change and I very much hope that government follows through on their announcement to shift focus towards improving public charging. Over 15 million motorists live in flats and terraces, many of whom are desperate to ditch their petrol and diesel cars and enjoy cleaner, greener motoring. But their biggest barrier is the lack of reliable, affordable charging close to their homes. Installing more public chargers is one way of alleviating their concerns. But so can Community Charging – that is when motorists with EV chargers on their driveways rent them out to neighbours who can’t have a charger of their own, helping them go electric straight away. There are around 30,000 public chargers in the UK and over 400,000 private ones. If only 10% were shared with neighbours it would more than double the amount of available chargers. It’s time for a grant to encourage charge point sharing.”