The government has cut support for purchases of electric vehicles (EVs) while completely axeing subsidies for hybrids, including the iconic Toyota Prius.
The Department for Transport (DfT) announced on Thursday (11 October) that it is changing the rules for the plug-in car grant (PICG) scheme, which has supported the purchase of 160,000 low emission vehicles since it was set up seven years ago.
Purchasers of the lowest emitting vehicles, classed in category 1, will receive £3,500, which is £1,000 less than they currently get.
Category 1 vehicles include all those emitting less than 50g/km CO2 and which can travel at least 112km without any emissions of the greenhouse gas.
Models which continue to benefit from this reduced subsidy include the BMW i3 and i3s, Citroen CZero, Jaguar I-Pace, Nissan Leaf, Toyota Mirai and all Teslas.
Category 2 and 3 vehicles, which currently are eligible for support of up to £2,500, will no longer qualify. These include the Mitsubishi Outlander PHEV, Toyota Prius Plug-in and all low emission vehicles manufactured by Audi, Mini and Volvo.
The changes are due to come into effect on 9 November. The government has set a limit of 35,000 on the number of vehicles that will enjoy support under the plug-in grant levels until that date.
The government said it aims to focus support on zero emission models like pure electric and hydrogen fuel cell cars and that hybrids will continue to benefit from help via mechanisms like lower car tax rates and grants for charging infrastructure.
The government has also earmarked £2 million for a fund to replace delivery vans with e-cargo bikes, which will be eligible for grants worth up to £5,000.
The DfT’s announcement coincided with the publication by the Committee on Climate Change of its response to the government’s “Road to Zero” strategy to reduce vehicle emissions.
It recommends bringing forward to 2035 from 2040, which the government has proposed, the target date for ending new sales of conventional petrol and diesel vehicles.
The coalition government had set out a vision for almost every car and van to be ultra-low emission by 2050.
Speaking at Utility Week’s Congress event in Birmingham earlier this week, Eon UK’s chief executive Michael Lewis called for the government to bring forward the proposed ban on diesel and petrol cars from 2040 to 2030.
He referenced the new report by the Intergovernmental Panel on Climate Change (IPPC) which warned that energy systems will require “far reaching” changes to prevent increases in global temperatures leading to runaway climate change.
Lewis said: “If we’re to deliver the carbon reductions we need, we need to electrify transport, we need to electrify heating and we need to bring demand customers into the system and value that flexibility.
“Eighty per cent decarbonisation by 2050 probably needs to go to 100 per cent and that means strong ambition needs to be even stronger.”
He added: “It’s critically important that the government really starts to drive that ambition so that we [the industry] can respond with our investment.”
The CCC says the government should mandate a minimum range that hybrids and EVs should be able to travel without having to recharge.
And it urges the DfT to increase the ambitions in its own road traffic forecasts for uptake of electric vehicles, which it currently predicts will only account for a quarter of kms travelled by 2050.
The cuts for low emission vehicle subsidies was slammed by Liberal Democrat environment spokesperson and former leader of the party Tim Farron.
He said: “This short-sighted decision from government is a dagger to the heart of their claims that they are serious about improving air quality. Encouraging people to buy cars that are less polluting makes sense and Liberal Democrats demand better for our environment than more Conservative cuts.”
But Daniel Brown, policy manager at the Renewable Energy Association, said the government is right to focus its help on the least polluting vehicles.
“Electric vehicles are quickly coming down in cost and they are significantly cheaper to run than petrol or diesel vehicles, but the market is not yet fully mature and the removal of grants needs to be done in a structured, long term way with support moving towards tax-based mechanisms.
“The government is right to now focus resources on grants for those vehicles with the highest zero emission range, such as battery electric vehicles as these will reduce emissions the most. Accelerated EV uptake is also critical for building a world class EV charging network in the UK as infrastructure investment is likely to match rates of EV deployment.”