The UK government has announced a £650m ($874.9m) Electric Car Grant (ECG) scheme designed to make electric vehicle (EV) ownership more affordable.
This initiative aligns with the UK government’s “Plan for Change” and aims to phase out new petrol and diesel cars by 2030.
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The scheme offers up to £3,750 off new eligible electric cars, with a price cap set at or under £37,000.
The grant is part of the government’s commitment to support the nation and other manufacturers that meet the “highest manufacturing sustainability standards”.
Starting from 16 July 2025, drivers can benefit from the discounts once manufacturers have their zero-emission cars approved for the scheme. The funding is available until the 2028 to 2029 financial year, the government said.
The grant aims to address the upfront expense barrier cited often by drivers as a hurdle for adoption.
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By GlobalDataBy narrowing the cost gap between petrol and EVs, the scheme is expected to offer many drivers access to significant savings.
With fuel and running expenses for electric cars being up to £1,500 less per year compared to petrol vehicles, the discount will make zero-emission cars cheaper to purchase and operate.
This scheme adds to the government’s extensive £63m investment in at-home charging solutions for those with no driveways, transitioning NHS fleets to electric, and installing chargepoints at business depots across the nation.
In total, the UK government is dedicating £4.5bn to accelerate the transition to EVs.
Complementing the grant scheme is the Zero Emission Vehicle (ZEV) Mandate, which obliges manufacturers to sell a growing percentage of zero-emission vehicles annually. The mandate, along with recent trade deals with India, the US, and the European Union, provides the automotive industry with the certainty and support needed amidst global economic challenges.
UK Transport Secretary Heidi Alexander said: “This EV grant will not only allow people to keep more of their hard-earned money – it’ll help our automotive sector seize one of the biggest opportunities of the 21st century.
“And with over 82,000 public chargepoints now available across the UK, we’ve built the infrastructure families need to make the switch with confidence.”
The government has also launched the DRIVE35 programme worth £2.5bn ($3.37bn), aimed at propelling the nation’s automotive sector into the future of zero-emission vehicle development.
