What was the Plug-in Car Grant?

Parkers electric cars

  • This was a government subsidy to help tackle air pollution
  • The £1,500 grant expired in June 2022, after being gradually phased out
  • The grant helped fund almost 300,000 cars in the UK

The Plug-in Car Grant, or PICG, was a government incentive scheme aimed at encouraging drivers to switch to electric vehicles. It was a ‘discount’ that had been applied to a selection of fully-electric vehicles, which had been reduced over time. It was dropped in June 2022.

There were key savings to be made with electric vehicle ownership, e.g. significantly reduced ‘fuel’ costs, lower maintenance and servicing, and of course, the environmental benefits. The Department for Transport (DfT) introduced the scheme to kickstart the sales of EVs, and with rising sales, post-2020, the government decided the scheme was no longer relevant.

That’s where the PICG comes in. The government hoped by offsetting the cost of buying an EV over a conventionally-powered car, consumers would begin to see those savings earlier thanks to the PiCG. The scheme continues for electric vans and taxis.

What benefits did the Plug-in Car Grant bring?

At the end of the scheme, vehicles priced up to £32,000 qualified for the Grant, provided they meet the other criteria. The cap was in place because higher-priced vehicles are ‘typically bought by drivers who can afford to switch without a subsidy from taxpayers.’

Previously, hybrids with a zero-emissions range of at least 70 miles, and quoted CO2 emissions of less than 50g/km could apply for the discount. Now, the requirements to meet the criteria only applies to fully electric vehicles – as well as the few hydrogen-powered models on sale.

>> Plug-in Car Grant axed

Plug-in Car Grant cars

What cars were eligible for the Plug-in Car Grant?

Plug-in Car Grant history

In 2011 the government introduced the scheme. It provided a £5,000 cash incentive off the list price of a qualifying vehicle, and aimed to help reduce emissions and improve air quality through increased takeup of zero-emissions vehicles.

With greater numbers of EVs (electric vehicles) and PHEVs (plug-in hybrid electric vehicles) now on the roads, the government revised the PiCG in 2016, 2018, and again in 2020 reducing its scope to reflect the increase in the popularity of zero-emission vehicles.

If you bought an eligible car before 2016, the PiCG paid £5,000 towards its list price. This was reduced to £4,500 in 2016, or just £2,500 for plug-in hybrids. In 2018 the scheme was reduced further, with full EVs now receiving a grant of £3,500 while PHEVs now receive no grant at all.

In the Spring 2020 Budget, this was further reduced to £3,000, and has been adjusted so that EVs costing more than £50,000 are no longer eligible. The good news is that the ‘temporary measure’ has been extended to run until at least 2023.

On 18 March 2021 it was cut even further to £2,500, and was made only applicable for EVs worth less than £35,000.

In December 2021, the PICG was cut by £1000 to £1,500, before being scrapped in June 2022.

More than 285,000 vehicles have been purchased with PICG assistance. Ultimately, the government is tasked with getting us all into zero emissions vehicles by 2050. By 2030, the sales of new petrol and diesel cars will be banned. Hybrid vehicles will follow suit by 2035.

Further reading

>> The cheapest electric cars
>> Electric car reviews
>> Government ban on petrol and diesel cars
>> The best small EVs