Government announces £500m support package for ULEVs including Plug-in Car Grant extension

Tue 29 April 2014 View all news

The Deputy Prime Minister has announced the main elements of a £500 million package of measures to support the development and use of a wide range of ultra low emission vehicles (ULEVs) to 2020. Included in the package is at least £200m to extend the duration of the Plug-in Car Grant plus a range of measures designed to improve access to low carbon fuels (including a rapid charge network), create more low carbon cities, save consumers money and encourage growth and jobs 

The announcement follows the call for evidence, launched in November 2013, which was intended to inform the design of the new package.

The Office for Low Emission Vehicles (OLEV) says that it will invest £500 million to boost the ULEV industry and including continued support to help drivers both afford and feel confident using electric cars.

The Government views the automotive sector as a success story in terms of the UK’s economic recovery. It says that the industry is worth £11.2 billion to the economy and that the production of ULEVs is a major part of growth both now and for the future.

Key elements of the package are:

  •       At least £200m for the continuation of the plug-in car grant;
  •     The grant to stay at £5,000 per car until 2017, or the first 50,000 vehicles, whichever is the sooner;
  •     Over £30m for other ULEV types including vans;
  •      £100m for ULEV-specific R&D;
  •      £35m for a new city scheme competition;
  •      £20m for ULEV taxis;
  •      £30m for low emission buses;
  •      £32m for infrastructure including rapid chargers;
  •      £4m for HGV gas refuelling infrastructure

The Government says that the investment of £500 million between 2015 and 2020 will create jobs, reduce emissions and set the agenda for the industry, for our towns and cities, and for motorists, so that Britain remains at the forefront of green technology.

The investment will, it says:

Create ‘Ultra Low Carbon City Status’

Local areas coming up with the most ambitious plans can win a share of £35 million to make the leap to becoming ultra low. Winning cities could, for example, incentivise drivers of green cars by letting them use bus lanes or allowing them to park for free. Additional funding of £50 million will also be available for local areas to invest in cleaner taxis and buses.

Create jobs and innovate

There will be £100 million invested in research and development in ULEVs to cement the UK’s position as a leader in the development of these technologies. The UK’s automotive industry has undergone a renaissance in recent years and we have the potential to emerge as a world leader in the development, design and manufacture of green vehicles. This investment will help create skilled British jobs and have further positive impact down the supply chain.

End ‘range anxiety’

£32 million funding boost for charging infrastructure including plans to install rapid chargepoints across the ‘M’ and ‘A’ road network by 2020 so that drivers can find a rapid chargepoint when they need one. Rapid chargepoints mean that a car can be charged in as little as 20 minutes.

Save consumers money

To encourage more people to use ULEV, car grants of £5,000 off the upfront cost will be extended. In total the value of this measure is worth at least £200 million.

The Deputy Prime Minister visited the Transport Research Laboratory in Wokingham with Chief Secretary to the Treasury Danny Alexander to see how green cars are tested and to speak to industry leaders.

Nick Clegg, Deputy Prime Minister, said: "Our economy is growing thanks to sectors like our thriving automotive industry that are helping repair and rebalance the economy, building a fairer society for this generation and the next.

"The UK has the potential to emerge as a world leader in the development, design and manufacture of green vehicles."

The Government plans to announce full details of each scheme in autumn 2014, with some of the schemes opening for applications shortly thereafter.

In a related development, the LowCVP launched its 2014-15 work plan which aims to complement the Government £500m investment in the promotion of ULEVs. One element of the work programme is a study which will investigate the impact of low carbon-focused transport policy on levels of investment, growth and jobs.

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