New Electric Car Grant: UK Drivers Set to Save Thousands as EV Discount Scheme Launches
In a major move to drive the electric vehicle (EV) revolution forward, the UK government has rolled out a new electric car grant, and it’s already making waves.
With up to £3,750 off the price of a new electric car, British motorists now have one less reason to hold back on making the switch.
This fresh initiative, backed by a substantial £650 million investment, is designed to make EVs more accessible and affordable to everyday drivers.
It’s a bold part of the UK’s wider Plan for Change, aiming to accelerate the country’s transition to cleaner transport.
So, what’s on offer? A maximum discount of £3,750 applies to the greenest electric cars priced below £37,000. No need to file paperwork—this discount is applied straight at the dealership.
It’s simple, quick and effective. According to the RAC, buyers could see these discounts rolling out on showroom floors in a matter of weeks.
There’s a tiered system in place. Top-tier EVs with the lowest emissions earn the full £3,750 cut. Other eligible models that don’t quite meet the top eco targets still bag a tidy £1,500 discount.
Crucially, manufacturers must show serious green credentials. Only car brands committed to Science-Based Targets (SBTs) on emissions—and that can demonstrate progress—qualify. Nearly 50 EV models are in line to meet the criteria, with more expected to follow soon.
Chinese-made EVs, often among the cheapest on the market, are being handled slightly differently. Their inclusion in the grant scheme depends on environmental performance. Those who qualify will typically access the £1,500 tier.
The Electric Car Grant (ECG) is set to run through the 2028/29 financial year, potentially supporting over 170,000 new EV purchases. That’s nearly half the electric cars bought in the UK last year.
Industry insiders are upbeat. “The biggest deals will be on the greenest models, so you’ll save money and help the planet at the same time,” says Simon Williams from the RAC.
“This grant is a great little push for anyone thinking about switching to electric,” adds Dan Caesar, CEO of Electric Vehicles UK.
“This should help loads of people make the switch. Plus, with new charging hubs and options for people without driveways, this is a real boost for the electric car revolution,” says Edmund King, AA President.
For many drivers, high upfront costs have been the single biggest hurdle. This grant is aimed at breaking that barrier down. Not only do EVs qualify for generous discounts, but they’re also cheaper to run.
Drivers could save up to £1,500 annually in fuel and running costs compared to petrol cars. With lower taxes and fewer maintenance issues, the lifetime savings quickly add up.
Affordable EVs on the rise
Affordability is on the upswing. Around two in five used electric cars now sell for under £20,000, while 34 new models are priced below £30,000—even before the new grant is applied. Some of the lowest-priced qualifying models include:
- Dacia Spring – from £14,995
- Leapmotor T03 – from £15,995
- Fiat Grande Panda – from £21,035
- MG4 – from £26,995
- Kia EV3 – from £33,005
And yes, brands like Volkswagen, Peugeot, Hyundai, Vauxhall, and MINI are all represented in the eligible model list.
This isn’t a one-off initiative. The government is backing the grant with further support for infrastructure and businesses. Here’s what else is in the pipeline:
- £25m to help local councils install “cross-pavement” charging solutions for people without driveways.
- £30m to aid businesses in electrifying their fleets.
- £8m to add EV chargers to more than 200 NHS sites.
- Over 82,000 public charging points now exist nationwide, with one being added roughly every 30 minutes.
The Zero Emission Vehicle mandate is also pushing manufacturers to prioritise EVs, with targets ramping up yearly.
And let’s not forget potholes. Yes, the government’s also earmarked £1.6bn to improve road quality and is freezing fuel duty until 2026. Every little helps.
If you’ve been on the fence about going electric, now might be the perfect time to jump.
“With other investments on the way, the UK is set to stay a world leader in making and selling zero-emission cars,” says Mike Hawes from the Society of Motor Manufacturers and Traders (SMMT).
This new electric car grant could reshape the UK’s automotive market. It’s a confident step towards cleaner transport, more savings, and a greener future.
And if you’re ready to make the switch, platforms like Carwow are ready to help you buy, sell or swap—grant included.
