Low to middle income earners should be offered interest-free loans for electric vehicle (EV) purchases to encourage their uptake, Ed Miliband has proposed.
In a speech on the green recovery, the shadow secretary of state for business said that while the lifetime costs of running an EV will soon be cheaper than for an internal combustion model, the greater upfront purchase costs remain a barrier for lower-earning households.
Miliband said that offering interest-free loans, which could be paid back as vehicle owners recoup savings from lower running costs of their new cars, would make EV ownership affordable.
The loans would be on offer for both new and used vehicles, the ex-Labour leader suggested.
Pointing out that households in the south east are four times more likely to own an electric car than those in the north east, he said: “We need to make electric vehicle ownership affordable for people with lower incomes not just the better off.”
Miliband said that the interest-free loans could be offered alongside the one-year initial trial of a national scrappage scheme for people who want to trade in their old and polluting cars, similar to the one introduced in the wake of the 2008 financial crisis.
He said that these moves to encourage uptake of EVs would be accompanied by a mandate for the soon-to-be established national infrastructure bank to accelerate the rollout of street charging points, targeting areas with relatively low installation rates of this infrastructure such as Yorkshire, the north west and the west midlands.
Miliband said: “To back the car industry and create jobs, 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 roll-out of charging points in regions that have been left out, we would ensure that everyone could benefit – rather than bake in unfairness.”
He also said that Labour would help the auto-manufacturers to prepare for the proposed 2030 ban on sales of diesel and petrol cars by part-financing the creation of three new, additional battery gigafactories by 2025.
While acknowledging that the Conservatives are “not climate deniers”, Miliband said that “after over a decade in power, they have shown they are not up to the task of the transformation we need”.
He dismissed Boris Johnson’s green recovery 10-point plan, unveiled last November, as merely a “list”, which is “already falling apart”, citing the problems that have bedevilled the Green Homes Grant home insulation voucher scheme.
Miliband also said the prime minister’s plan “comes nowhere close to the scale of ambition we need” because it has pledged “just a tiny fraction” of the sums required to tackle the climate change issue.
“At this moment when the country is crying out for a green economic recovery because of the jobs crisis and the climate crisis, they have flunked the test.”