A Toyota Prius sold to a taxi owner-driver has become the first petrol-electric hybrid car licensed for carrying passengers in Britain.

The deal looks likely to grab the attention of the UK's licensed hire trade because the buyer is Mark Cartledge, chairman of the National Private Hire Association, based in Nottingham.

The Prius was closely examined by Nottingham City Council, which would not normally consider licensing a cab with an engine capacity of less than 1.6 litres. Other local authorities have 1.8 or 2.0-litre thresholds.

Nottingham City Council has been trying to get to grips with pollution through imposition of its "Clean Zone" daytime traffic controls, and it was the exceptional environmental friendliness of the Toyota Prius that helped persuade the council to license it for Mark Cartledge as an "experimental vehicle". It will now become part of the 150-strong fleet of the city's DG Cars.

Cartledge qualifies for a £1,000 purchase grant from the government's Powershift incentive programme.