Boosting Britain’s EV sales? A look at The Electric Car Grant

Thinking of going electric or getting a new EV? Well, you might be able to take advantage of the government’s recently introduced Electric Car Grant (ECG).

The ECG is part of a £4.5 billion investment which the government says is to “turbocharge electric vehicle adoption, whilst boosting industry and driving growth as part of the Plan for Change”.

They say, that “with upfront costs often cited as a barrier to buying EVs, the discounts are designed to bring down the price of models so they more closely match their petrol and diesel counterparts”.

What you need to know

Put simply, ECG is a money-off the purchase price incentive, for new electric vehicles only.

The RRP of all eligible vehicles needs to be below £37,000 and the volume of the discount (up to £3,750) is based on how ‘green’ the car manufacturing process is. These rules are based on the carbon emissions of the electricity grid in the vehicle production stages, including assembly and battery production. The DfT has also said that 33 new electric car models are available for less than £30,000.

Discounts

There are two bands of discount, dependent on sustainability credentials.  Band one offers a £3,750 discount for the ‘greenest’ vehicles, and band two vehicles can be discounted by £1,500.

Which manufacturers will or won’t be on the list?

The full list of eligible models and makers is a way off being finalised because manufacturers need to apply for funding. However, the government has announced 19 models for inclusion (by August 9^th 2025). On the list are EV’s from Citroën, Nissan, Renault, and Vauxhall, including the Citroën ë-C3, Renault Megane, Nissan Micra, and Vauxhall Astra Electric.

There is a dedicated page on the GOV.UK website, which will be updated with a list of approved vehicles as and when more manufacturers and models are approved for the funding. The DfT says it expects to approve more vehicles over the coming weeks.

As the price of their new cars start at around £40,000, Teslas won’t be eligible for the discount. Chinese-made cars from makers like BYD won’t be eligible either, because they don’t meet the government’s criteria for environmentally sustainable manufacturing practices.

Reaction

On the topic of the grant itself the Transport Secretary, Heidi Alexander, commented:

“We are making it easier and cheaper to own an electric car. This 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 in the 21st century.”

Our Head of EV Charging, Graeme Patton, had this to say:

“The more that can be done to lower the price of new EVs the better, so the grant is certainly a welcome move.  Not only will it support people to switch but encouraging the sale of new EVs also means there will be a larger pool of cheaper used electric cars too. Anything that contributes to equity when it comes to electric vehicles is a huge positive”.

The early impact… is it time to buy?

There are early signs that EV demand is strong following the July announcement and the latest tranche of cars to be announced as part of the ECG. The scheme is scheduled to run until 2027–28  - or until the funding runs out.

It’s also been reported that some manufacturers that won’t be eligible for inclusion are discounting as well, so not to be at a competitive disadvantage.

RAC head of policy, Simon Williams, said:

“Another wave of cars qualifying for the government’s revamped Electric Car Grant is yet more welcome news. It’s also very positive to see other manufacturers that don’t meet the grant’s green production targets lowering their prices. Those looking to make the switch now have a wider choice of better value vehicles than ever before. This can only help speed up the transition to electric motoring”.

We will certainly be keeping an eye on how things develop and hope that this certainly is a boost for EV sales in Britain.