The UK scraps its £1,500 new EV grant a year early – Here’s why

The UK government’s £1,500 EV grants were discontinued yesterday, nearly a year earlier than planned.

The UK’s new EV grant is axed.

The UK Department for Transport announced that new EV grant funding will be shifted to support improving EV charging and funding “electric taxis, vans, trucks, motorcycles, and wheelchair accessible vehicles.”

The grant scheme, which first started in 2011, was reduced from £2,500 to £1,500 in December for EVs that cost under £32,000. (FYI, a Tesla Model 3 starts at £45,990.)

The scheme has helped increase the sales of EVs in the UK from less than 1,000 in 2011 to almost 100,000 in the first five months of 2022 alone.

Battery and hybrid electric vehicles (EVs) now make up more than half of all new cars sold and fully electric car sales have risen by 70% in the last year, now representing 1 in 6 new cars joining UK roads.

Here’s the reason the Department for Transport gave for its cancellation of the car grant scheme and the shift of its focus to charging and other electric vehicles. The British government basically says consumers no longer need the incentive to switch to electric:

The government has always been clear the plug-in car grant was temporary and previously confirmed funding until 2022-23. Successive reductions in the size of the grant, and the number of models it covers, have had little effect on rapidly accelerating sales or on the continuously growing range of models being manufactured.

Mike Hawes, the chief executive of the Society of Motor Manufacturers and Traders, the trade association for Britain’s motor industry, said in a statement:

With the [auto] sector not yet in recovery, and all manufacturers about to be mandated to sell significantly more EVs than current demand indicates, this decision comes at the worst possible time. If we are to have any chance of hitting targets, government must use these savings and compel massive investment in the charging network, at rapid pace and at a scale beyond anything so far announced.

inews notes that there are currently 24 EV models on the UK market priced under £32,000.

The British government is also planning to implement a zero emissions vehicle mandate, which will force auto makers to sell a set proportion of electric cars or face fines.

The UK is due to ban the sale of new gas and diesel cars from 2030, but it’s now the only major European market to have no upfront incentives for EV buyers.

Read more: How insulation and heat pumps could cut the UK’s – and other countries’ – need for Russian gas

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