February 25, 2010 3:16 am

Electric car buyers to receive subsidy

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Anyone who buys an electric car will be able to take advantage of a subsidy of up to £5,000 ($7,684) under plans to be set out by the government on Thursday.

Lord Adonis, transport secretary, will announce that up to £230m will be made available for this “plug-in car grant” – although the initiative will not begin until January next year, reflecting the fact that most models are not yet available to the public.

Ministers have indicated that they could subsidise consumer purchases of electric cars and plug-in hybrids, but these are the initial details of how the scheme should work. Grants of 25 per cent of the purchase price of a vehicle – up to the £5,000 limit – will be made to any buyer.

Pat McFadden, business minister, said that cars such as GM’s Ampera model, due to launch in 2012, will soon be coming to the market.

The government will meanwhile announce on Thursday that three areas – London, Milton Keynes and the North-east – have been picked as the winners of a scheme to trial thousands of charging points for electric cars and plug-in hybrids.

The announcement of the £8.2m scheme, which will be matched by equivalent money from other local sources, is the first wave of a wider £30m initiative to create the infrastructure needed for consumers to run electric cars.

Under the pilot, London residents should have access to charging points in 6,000 workplaces, 500 streets and 330 car parks. In Milton Keynes, also set to have charging points across the city, there will be a £75 grant for any family that wants to instal a charging point in their own home.

The three areas won against competition from six other regions, including the West Midlands, Cornwall, Sheffield and Greater Manchester – some of which are expected to take part in the second wave of funding later in the year.

Mr McFadden said that the scheme was proof that the government was committed to a low-carbon economy.

“We are putting in the key elements needed for car manufacturers, for charging infrastructure and consumer incentives as the main parts of a strategy to make sure Britain makes the most of the transition to low-carbon in terms of industrial capability,” he said.

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