Diesel scrappage scheme could be on the way

Issues surrounding harmful nitrogen oxide (NOx) and particulate emissions from diesel engines have rarely left the headlines in recent months, and it’s due to continue as a draft consulation by the government suggests a new diesel scrappage scheme could be on the way from the Department for Transport (DfT) and Department for Environment, Food and Rural Affairs (Defra).

Government suggests diesel scrappage scheme

In May 2017, the government’s draft clean air bill proposed that owners of older diesel cars might be paid to move to cleaner vehicles. 

There was also mention of potentially retrofitting buses, lorries, and black cabs with technology to reduce emissions.  

The draft response was published following pressure from environmental lawyers ClientEarth to speed up the process, as the firm believed the government was dragging its heels. 

There is a suggestion that a scrappage scheme could come into effect within two years, but there is no confirmed date and currently it remains just a potential scheme. 

What impact would a scrappage scheme have? 

A diesel scrappage scheme, funded by the Treasury, would aim to limit the appeal of buying a diesel-powered car – instead boosting the appeal of cleaner vehicles and such as electric and plug-in hybrid cars, thus improving air quality across the country.

It's all with the purpose of improving air quality levels, especially in urban areas where pollution has reached toxic levels in recent years.

A scrappage scheme would involve a cashback incentive or discount on low-emission cars by trading in an older diesel model – but UK transport secretary Chris Grayling claims a scheme such as this needs to be targeted and executed appropriately.

Mike Hawes, SMMT (The Society of Motor Manufacturers and Traders) Chief Executive, said: ‘SMMT welcomes the publication of government’s proposals for improving air quality across the UK. Industry is committed to improving air quality across our towns and cities and has spent billions developing new low emission cars, vans, trucks and buses and getting these new cleaner vehicles on to our roads quickly is part of the solution. As outlined in the plan, any proposed scrappage scheme would need to be targeted and deliver clear environmental benefits.’  

How are diesel cars currently dealt with by the government?

Up until now, low-CO2-emission diesel cars have enjoyed free road tax under the current VED tax system if under 100g/km, but the revised 2017 tax system that came into effect on 1 April 2017 redresses the balance with a flat £140 rate after the first year.

Read more about the impacts of the new 2017 VED tax changes here

Part-electric vehicles, such as the Toyota Prius below, are currently eligible for a plug-in car grant at two different levels - £4,500 for a full electric vehicle and £2,500 for a plug-in hybrid – so something like this could continue to boost the appeal further.

This type of car still tends to be more expensive than an equivalent diesel, thus holding back the appeal of electric vehicles (EVs) and plus-in hybrid electric vehicles (PHEVs) – as well as the limited charging infrastructure.

It hasn’t been confirmed yet, and there are conflicting reports as to when and what the details are of the proposed scheme, but we’ll keep this page updated with the latest information.