The British government will provide £500 million to support the rollout of public charging points for electric cars and extend grants for the purchase of plug-in cars until 2023, the Chancellor of the Exchequer said March 11 when outlining the 2020 national budget.
Rishi Sunak said the government intends to support the installation of a fast-charging network dense enough to ensure drivers would always be within 30 miles of a charger. Part of the money would be used to support businesses in covering the cost of connecting charging points to the grid.
"Consumer incentives support the development of markets for new transport technology. ... Access to high quality, convenient charging infrastructure is critical for drivers to make the switch to electric vehicles confidently," Sunak told MPs in a live televised address.
The U.K. currently has 30,000 public charging points, according to the Go Ultra Low public-private clean transport campaign. But many more will be needed, especially after the government said it would consult on bringing forward its ban on the sale of gasoline and diesel cars to 2035 from 2040. Road transport accounts for 91% of domestic transport emissions and one-fifth of the U.K.'s overall CO2 emissions.
To accelerate the uptake of electrified cars, which will also help the government meet international commitments to cut national CO2 emissions, it will extend the grant to consumers for the purchase of fully-electric plug-in cars until 2023, with a pot totaling £403 million.
Currently, the government pays up to £3,500 towards the cost of new plug-in cars to reduce their much higher cost compared to equivalent internal combustion engine models. Plug-in hybrid cars are not eligible for a grant but buyers can receive up to £500 towards the cost of installing a charging point at home, according to the Go Ultra Low's website.
The government will provide a further £129.5 million to offer the grant for purchases of plug-in vans, taxis and motorcycles over the same period. It will also extend the exemption on vehicle excise duty on some zero-emission cars, the levy paid annually on all cars for road use, to more expensive, high-end models.
The announcement will be welcomed by automakers who have seen demand for electric cars dive in countries where subsidies have been withdrawn, particularly with the potential for fines from 2020 onwards if they fail to cut CO2 emissions in the European Union to a fleet-wide average of 95g per km.
The budget also included an additional £304 million for local authorities to take "immediate steps" to cut emissions of nitrogen dioxide, taking the total to £880 million. The health-harming gas was at the center of the Volkswagen diesel emission cheating scandal and is emitted in large quantities by older diesel cars. Some classifications of diesel vehicles have been banned by several cities in Europe, particularly in Germany, in order to bring nitrogen dioxide levels back within legal limits.
The government announced it would also increase restrictions on the use of "red diesel," fuel taxed at a lower rate and used in heavy machinery and vehicles used mainly on private land, from April 2022. While the agriculture, fish farming and rail sectors may continue to use it, others such as construction will be obliged to use regular, higher-taxed diesel. The measure aims to create an incentive for users of heavy machinery to seek cleaner, more efficient alternatives whose development the government said it will help bring forth through its Energy Innovation Programme.
Despite speculation that the government would seek to nudge consumers further towards electric vehicles by ending the freeze on fuel duty, a tax on gasoline, Sunak said the freeze would continue for a tenth year "in recognition of the rising cost of living."