Department for Business, Innovation and Skills
Printable version E-mail this to a friend

Green light to ultra low carbon car consumer incentive

Green light to ultra low carbon car consumer incentive

News Release issued by the COI News Distribution Service on 28 July 2010

Transport Secretary Philip Hammond confirmed today that motorists will receive up to £5,000 towards purchase of an ultra-low carbon car from January 2011.

Exceptionally, the Government has agreed the announcement of this incentive ahead of the completion of the spending review to support the early market for ultra-low carbon cars. The Government remains committed to reducing the UK’s budget deficit, but understands the need for certainty for investors who are taking long term decisions now on where to launch ultra low carbon vehicles and where to locate future production.

The consumer grant will reduce the up-front cost of eligible vehicles by 25 per cent, capped at £5,000. Available across the UK, it will be open to both private and business fleet buyers.

Transport Secretary Philip Hammond said:

“The coalition Government is absolutely committed to low carbon growth, tackling climate change and making our energy supply more secure.

“We are sending a clear signal that Britain is open for business and that we are committed to greening our economy. This will ensure that the UK is a world leader in low emission vehicles.

“We will review the level of the incentive regularly to ensure that the UK remains competitive and taxpayers get value for money. The first review will be in January 2012, at which point we will set the level for subsequent years.”

Business Minister Mark Prisk said:

“The consumer incentive will help Britain become one of the leading centres for the design, development and manufacture of ultra-low carbon vehicles. It sits alongside public and private sector investment in innovation and infrastructure, leading to the creation of new highly skilled low carbon jobs.”

Energy and Climate Change Secretary Chris Huhne said:

“Electric and low carbon cars are fun to drive and essential to meet our climate targets.

"That’s why we’ll need a massive increase in the number of electric and clean green cars on our roads. Because this is new technology the Government needs to step in to kick start the market which is why today’s initiative is vital.”

Notes to editors:

1. The level of the consumer incentive has been agreed until 31 March 2012. The level will be reviewed in January 2012. After taking into consideration a number of key factors such as the costs of vehicles and the development of the early market, the level will then be set for subsequent years.

2. £43m has been made available up to the end of March 2012. The final budget beyond 2011/12 will be confirmed at the spending review.

3. Any car eligible for subsidy will have demonstrated compliance against safety and performance criteria. These criteria will be published shortly at

4. The Plugged-In Places initiative is on-going and final funding will be decided in the spending review.

5. Department for Transport contacts:

Press Enquires: 020 7944 3066 Out of Hours: 020 7944 4292 Public Enquiries: 0300 330 3000 Department for Transport Website:


BIS Press Office

Rebecca Murrell
Phone: 020 7215 6403

UK’s best performing Local Government AI Citizen Assistant