Who Qualifies for the New UK Electric Car Grant?
If you’ve been eyeing an electric car but hesitated because of the price tag, there’s good news on the horizon. The UK government is rolling out a fresh Electric Car Grant, offering discounts of up to £3,750 on new EVs. But before you start shopping, it’s worth understanding exactly who qualifies.
First, the grant only applies to new electric vehicles priced at or below £37,000. That threshold was set to target the more affordable end of the market, making EVs accessible to a wider range of buyers. So, if you’ve got your heart set on a luxury model above that price point, you’ll need to look elsewhere for savings.
There’s another twist: the grant isn’t just about the sticker price. To qualify, the car’s manufacturer must meet strict sustainability criteria. This means only manufacturers with verified science-based targets (SBTs) for carbon reduction, as validated by the Science Based Target initiative (SBTi), are eligible. The government will also assess the carbon emissions involved in both vehicle assembly and battery production. The specifics of these thresholds are still under wraps, but the focus is clear—only the greenest manufacturers will make the cut.
How Much Can You Save, and How Is It Decided?
Unlike the previous Plug-in Car Grant, which offered a flat £1,500 discount, the new scheme is a bit more nuanced. Cars are divided into bands based on their sustainability credentials. Vehicles in “band one” will get the full £3,750 off, while those in “band two” could receive up to £1,500. There’s talk that more bands could be introduced as the scheme evolves.
The government hasn’t yet published the exact criteria for these bands, but it’s all about rewarding manufacturers who go the extra mile in reducing emissions—not just from the tailpipe, but throughout the entire production process. It’s a move that nudges the industry toward cleaner practices while giving buyers a financial nudge to go electric.
When Does the Grant Start, and How Do You Get It?
The scheme kicks off from Wednesday, 16 July. Here’s the best part: you don’t have to do any paperwork yourself. Manufacturers are responsible for submitting their eligible models for inclusion, and if they’re confident of approval, even sales made before formal application approval (but after 16 July) can qualify—provided all scheme criteria are met.
The government will soon publish a list of qualifying models, so keep an eye out if you’re in the market. But don’t wait too long. The £650 million pot is first-come, first-served, and the scheme could close early if funds run out. There’s no guarantee it’ll last until the planned end date in the 2028-29 financial year.
Why Not All Electric Cars Make the Cut
Some buyers might wonder why pricier EVs, like the £37,500 Vauxhall Grandland Electric, are excluded. The answer is simple: the government wants to make the best use of taxpayer money by focusing on vehicles that most people can afford. Subsidizing luxury cars isn’t on the agenda. This approach also helps drive mass adoption, which is crucial for meeting the UK’s ambitious zero-emission targets.
It’s also worth noting that UK-made vehicles don’t get any special treatment. Every car, regardless of where it’s built, is assessed under the same framework. That levels the playing field and keeps the focus on sustainability.
What Does This Mean for the UK EV Market?
The timing of this grant is no accident. Since the previous Plug-in Car Grant was scrapped three years ago, demand for new EVs has lagged behind expectations. Fleet sales have kept numbers afloat, thanks to generous tax breaks, but private buyers have been slower to jump in.
Industry leaders have been vocal about the need for renewed support. Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders, called the grant a “clear signal” for buyers to go electric. He’s not alone—executives from Renault and Volkswagen have welcomed the move, though they’re waiting for more details before predicting its full impact.
The grant also dovetails with the UK’s Zero Emission Vehicle (ZEV) mandate, which requires 28% of new car sales to be fully electric this year. Falling short means hefty fines for manufacturers—£12,000 per non-compliant vehicle. So far, just under 25% of new cars sold in 2024 have been EVs, putting extra pressure on the industry to boost sales.
How Does This Fit with Broader Government Support?
The Electric Car Grant is just one piece of a larger puzzle. The government recently announced Drive35, a £2.5 billion fund to support zero-emission vehicle manufacturing, research, and job creation. The goal is to keep the UK at the forefront of EV development, attract investment, and create opportunities across the country.
Business and trade secretary Jonathan Reynolds summed it up: economic growth is the top priority, and supporting the auto sector is key to delivering jobs and prosperity.
What Should Buyers Do Next?
If you’re considering an EV, now’s the time to get serious. Watch for the official list of qualifying models, and talk to dealers about which cars are eligible. Remember, the grant is applied at the point of sale—no forms, no fuss. But with limited funds, acting sooner rather than later could make all the difference.
The big takeaway? Going electric isn’t about perfection—it’s about smarter adjustments. Start with one change this week, and you’ll likely spot the difference by month’s end.