UK Government Launches New EV Grant to Boost Electric Car Uptake

17/09/25

Starting 16 July 2025, the UK government reintroduced financial incentives for electric vehicle buyers, offering grants of £1,500 or £3,750 on new EVs priced below £37,000. This initiative is part of a £650 million plan aimed at encouraging cleaner transport and making electric cars more affordable for a wider audience.

Making EVs More Affordable
The scheme will run through 2029 and is designed to help narrow the upfront cost gap between petrol/diesel cars and electric alternatives. By reducing the initial expense, the government hopes to make the switch to electric more appealing for drivers who might otherwise be deterred by higher prices.

Electric vehicles accounted for 21.6% of all new car sales in the first half of 2025, slightly below the government’s target of 28%. With the ban on new petrol and diesel cars now planned for 2030, this grant aims to reignite adoption and ensure EVs remain accessible.

How the Grant Works
Discounts are automatically applied at the point of sale, handled directly by manufacturers and dealers. To qualify, vehicles must meet strict sustainability criteria, including verified Science-Based Targets (SBTs) for emissions reduction.

• The full £3,750 grant is available for the most environmentally sustainable models.
• Vehicles meeting minimum criteria are eligible for a £1,500 discount.
• Around 50 new EV models are expected to qualify under the scheme.

Eligibility Requirements
Not all electric cars will qualify. Vehicles must meet the following standards:

• Zero tailpipe CO? emissions
• Minimum 100-mile WLTP electric range
• Battery warranty of 8 years or 100,000 miles (with 70% capacity retention)
• 3-year general warranty
• Approved under UN Regulation No. 100

This ensures the grant supports truly practical and sustainable EVs, rather than just inexpensive models.

Industry Reaction
While the new incentive has been welcomed by many, some manufacturers and trade groups have raised concerns. Confusion over eligible models and how the funds will be distributed has been cited, and there are worries that a limited number of vehicles will actually meet the criteria.

Some industry experts argue that further investment in home charging infrastructure or the used EV market could help make electric vehicles more accessible, especially for lower-income households less likely to purchase new cars.

Citroën EVs Receive £1,500 Discount
Transport Secretary Heidi Alexander confirmed that buyers can now claim a £1,500 discount on select Citroën EVs, including the ë-C3, ë-C4, ë-C5, and ë-Berlingo. More eligible vehicles are expected to be announced as the scheme rolls out.

A Positive Step Forward
While not without challenges, the reintroduced grant demonstrates the government’s renewed commitment to supporting EV adoption and easing the cost of transition. If manufacturers respond with more sub-£37,000 EVs, this scheme could significantly boost uptake and confidence in the market.

As always, the effectiveness of the initiative will depend on the details, and drivers, dealers, and automakers alike will be watching closely to see how it unfolds.