The UK is one of the few governments that has a comprehensive strategy for electrification, with both an official Office for Zero Emission Vehicles (OZEV) and an electrification strategy called the Road to Zero strategy. This article will take a closer look at EV and EV charging policies and incentives in the UK.
EV Charging Incentives in the UK
The UK has a growing network of charging points. In 2020, the number of charging points almost doubled, to around 30,000.
- EV charger grant for homes: the Electric Vehicle Homecharge Scheme (EVHS) enables individual buyers of eligible EVs to receive a grant for up to 75% (capped at £350, inc. VAT) of the total purchase and installation costs of one EV charger for their home. Company cars and leased cars are also eligible. You can apply here.
- The EVHS will continue and be expanded this year – likely by autumn – to provide extra help for people in flats (leasehold accommodation) and rental properties.
- As a result, it will subsequently be restricted from the 31st of March 2022 to just these sectors.
- EV charger grant for workplaces: the Workplace Chargepoint Grant is a voucher-based scheme that provides the upfront costs for the purchase and installation of EV charging points at workplaces:
- After the 1st of April 2020: firms can cover 75% of all purchase and installation costs, up to a maximum of £350 for each socket, for up to a maximum of 40 across all sites. You can apply here.
- Until the 1st of April 2020: firms can cover 75% of all purchase and installation costs, up to a maximum of £500 for each socket, for up to a maximum of 20 across all sites. You can apply here.
- From next year the Workplace Charging Scheme (WCS) will be opened up to small to medium enterprises (SMEs) and the charity sector. The changes will also mean that small accommodation businesses, such as B&Bs can benefit from the funding, boosting rural areas, and tackling the ‘range anxiety’ associated with long journeys.
- Company Tax Benefits: businesses that install charging infrastructure can access tax benefits through a 100% first-year allowance (FYA) for expenditure incurred on electric vehicle charging equipment.
Local and Regional Incentives
- EV charger grant for homes in Scotland: the Energy Saving Trust enables individual buyers of eligible EVs to receive a grant for up to £300 of the total purchase and installation costs of one EV charger for their home, with an additional £100 available for those in rural Scotland. This grant is available on top of the £350 OZEV grant mentioned above. You can apply here.
- EV charger grant for workplaces in Scotland: the Energy Saving Trust enables businesses to receive funding for the purchase and installation costs of EV chargers for their workplace. The exact number of EV chargers for which financial support can be provided depends on the amount and type of company and staff-owned EVs. Currently, funding is only available for workplace charge points aimed at occupiers, staff and visitors. Funding for workplace charge points that are 24/7 available for use by the general public has been closed For more detailed information and the application form, click here.
Support to Develop EV Charging Infrastructure for Local Authorities
The On-Street Residential Charge point Scheme (ORCS)
Some local authorities have taken advantage of OZEV’s On-Street Residential Charge point Scheme (ORCS) to receive help and guidance to install on-street charging points in their localities. Local Authorities can receive a grant to part-fund (75%) the capital costs relating to the procurement and installation of on-street electric vehicle charge point infrastructure in residential areas. You can check if your local authority is part of the ORCS here.
EV Incentives in the UK
With alternatively fuelled vehicles now making up roughly 10% of total car sales, the future of EVs in the UK is looking promising. EV sales in the UK rose by 132% in 2020 despite the pandemic, and it is predicted that 1 million of them will be in use by 2025.
Let’s explore the EV incentives available in the UK.
- Purchase grant: with the Plug-in Car Grant, buyers can receive up to:
- 35% of the cost of an electric car (up to a maximum of £3,000 depending on the model)
- 20% of the cost of an electric motorcycle or moped (up to a max. of £1,500).
- 20% of the cost of an electric van (up to a max. of £8,000).
- 20% of the cost of a large electric van or truck (up to a max. of £20,000 for first 200 orders, after that up to a max. of £8,000).
- 20% of the cost of an electric taxi (up to a max. of £7,500).
- This grant is administered by OZEV. You do not need to do anything to benefit from this grant scheme as the dealer will include the value of the grant in the vehicle’s price. Car manufacturers and dealerships can apply here to participate.
- Ownership tax: pure electric vehicles costing less than £40,000 are exempt from the Vehicle Excise Duty (annual road tax).
- Company car tax: businesses that buy EVs can write down 100% of the purchase price against their corporation tax liability if the vehicle emits no more than 50g/km CO2, (paying just 1% CCT in 2021, and 2% in 2022); plug-in electric vehicles emitting less than 50g/km of CO2 have their company car tax set at 16% in 2020, which is 4-8% lower than the tax on diesel company vehicles.
Local and Regional Incentives
- Scotland: The Scottish Government offers an interest-free loan to support drivers switching to an EV or hybrid car. Loans of up to £35,000 to cover the cost of purchasing a new electric/hybrid vehicle, repaid over a period of 6 years. Find out more here.
- Northern Ireland: A maximum grant of €5,000 is available for privately bought EVs, and a max grant of €3,800 for those bought commercially. Find out more here.
- London: EVs and plug-in hybrids (PHEVs) are exempt from London’s Congestion Charge scheme until 2025.
- Local parking benefits: There is free and discounted parking for EVs in some localities.
Additional benefits: The UK Government has started providing EV owners with special green number plates so that they can benefit from local incentives, such as free parking, using bus lanes, and accessing areas cut-off from normal vehicles.
Overview of Government Electrification Initiatives & Policies in the UK
The Office for Zero Emission Vehicles (OZEV)
The Office for Zero Emission Vehicles is a team backed by over £900 million in funding who work across different areas of the UK Government – notably the Department for Transport and the Department for Business, Energy & Industrial Strategy – to support the early market for zero emission vehicles (ZEV). They aim to position the UK as a leader of ZEV development, manufacture and use. Through this, they hope to contribute to economic growth and reduce greenhouse gas emissions and air pollution in the UK.
OZEV oversees a number of key policies and initiatives promoting EV adoption in the UK, including:
- EV grants for ZEVs
- research programmes
- business consulting
- funding incentives
- developing the UK’s ULEV manufacturing capacities
- contributing to the development of new carbon dioxide emissions standards
As well as its foundational government team, OZEV is also supported by staff on secondment from industry and academia.
OZEV: Go Ultra Low Campaign
One of OZEV’s most prominent projects is the Go Ultra Low campaign, a joint Government and automotive industry initiative supported by OZEV and the Society for Motor Manufacturers and Traders (SMMT). This campaign is principally focused on education and awareness-raising. It provides all the information prospective EV buyers in the UK need to both buy an EV and take advantage of all the benefits associated with being an EV owner. For instance, the Go Ultra Low website offers answers to prospective and existing EV owners’ common questions, such as how to choose the right electric vehicle, which energy tariff to go for, and how to charge your EV at home. The Go Ultra Low website provides all of this information, plus guidance on how to fully capitalise on UK EV and EV charging incentives. There are also tools to calculate how much you could save as an EV, rather than a conventional car owner. OZEV has also done a really fantastic thing by automatically enrolling all recipients of the plug-in car grant into Go Ultra Low.
The Road to Zero Strategy
The Road to Zero Strategy outlines how the government will facilitate the transition to zero-emission road transport and reduce emissions from conventional vehicles during the transition. Although the strategy is long-term in scope and ambition, covering the drivers of change, opportunities and risks until at least 2050, it has a practical focus on how the UK will lay the foundations for the transition now. This strategy has a £290 million budget dedicated to boosting the use of low-emission vehicles.
The Transport Energy Model (TEM)
The TEM is a model developed by the Department for Transport (DfT), in collaboration with industry, academia, environmental groups and governments. It assesses the energy consumption, air quality pollutant emissions and greenhouse gas emissions of a range of road transport fuels and technologies over the period to 2050. The model includes comparisons of various vehicle powertrain technologies and fuel options for cars, vans, buses, trucks and HGVs.
The Charging Infrastructure Investment Fund
The UK government announced a £500 million fund for the development of “green technologies for a cleaner and healthier future” in September 2019. This includes a new £400 million Charging Infrastructure Investment fund, managed and invested on a commercial basis by private sector partners, who will pay for half the fund (£200 million). The first £70 million investment, provided by the UK Government and the car company Masdar, will go towards creating 3,000 new rapid charge points, more than doubling the number of rapid charge points across the UK by 2024.
Both OZEV and other government departments working on the Road to Zero strategy aim to end the sale of fossil-powered vehicles by 2040 using policies covering commercial vehicles, public transport, charging infrastructure and more. These include both EV and EV Charging Incentives, as we explored in more detail above.