The government's Electric Car Grant has provided financial assistance to over 140,000 drivers in its inaugural year, a move that appears to be significantly boosting the uptake of electric vehicles (EVs) across the UK. Launched on 16 July last year with a substantial £2 billion in funding, the scheme offers discounts of either £1,500 or £3,750 on the purchase of new EVs, dependent on specific sustainability criteria. The Department for Transport (DfT) stated that the initiative directly addresses the substantial initial cost, which has historically been a major deterrent for drivers considering the switch to electric.
This surge in interest is further supported by recent data from the online vehicle marketplace Autotrader, which indicates that new electric cars are now more affordable than their petrol counterparts. Concurrently, figures released by the Society of Motor Manufacturers and Traders reveal a remarkable 35 per cent increase in registrations of pure battery electric new cars in June compared to the same period last year. This growth has propelled their market share from nearly 25 per cent a year ago to 30 per cent, signalling a notable shift in consumer preferences.
Decarbonisation minister Keir Mather commented on the trend, stating that demand for EVs is "stronger than ever and only going in one direction." He highlighted the government's efforts to make electric vehicles more accessible and affordable, noting potential annual savings of up to £1,400 on running costs. Mather emphasised that this makes it an opportune moment for drivers to transition, especially given the current volatility in global fuel prices.
Simon Williams, head of policy at the RAC, lauded the grant for its "positive difference to EV sales in its first year," echoing the sentiment that the high upfront cost has long been the primary obstacle to widespread EV adoption. He also pointed out that with 58 models now qualifying for the discount, consumers have a broader selection of vehicles at various price points, enhancing choice and flexibility.
Looking ahead, the government has confirmed plans to introduce a new pay-per-mile scheme for electric vehicles, set to commence in April 2028. Under this forthcoming system, owners of fully electric cars will incur a charge of 3p per mile, while plug-in hybrid models will be charged at a reduced rate of 1.5p per mile. These figures remain below the 6p per mile currently paid by drivers of petrol and diesel vehicles through fuel duty. The new eVED system will calculate an upfront charge based on estimated mileage, with options for monthly payments similar to the existing Vehicle Excise Duty structure. Drivers will submit actual mileage readings annually, cross-referenced with MOT data, with any outstanding balance settled or spread over the subsequent year.