UPDATE: UK Gov. Extends Plug-in Car Grants With New Tiered System, Lower Grant Values for Cars, Charging

Update: As pointed out by a reader, the UK Government will still offer £4,500 towards every zero-emission car over £60,000 — which means the Tesla Model S and Tesla Model X will be eligible for the maximum grant rate. The £60,000 limit will apply to cars with zero emission range of less than 70 miles. Please note that we have modified the article below to reflect our earlier error, and apologize for any confusion. 

For the past five years, those wanting to buy a brand-new plug-in car in the UK have been given some substantial financial support from the UK Government to do so. Alongside a generous $5,000 government plug-in vehicle grant towards the purchase of their car, plug-in car owners could get a grant covering up to 75 percent of the total capital costs of purchasing and installing a domestic charging station for use with their electric car, up to a total value of £1,000.

What’s more, nearly every motorway-capable plug-in car — electric and plug-in hybrid — was eligible for the full £5,000 grant.

Those buying a Nissan LEAF from March will get a £4,500 grant towards its purchase

Those buying a Nissan LEAF from March will get a £4,500 grant towards its purchase

But on the same day that the UK Government announced a total of 93 new onshore oil and gas Petroleum Exploration and Development Licenses to grant companies exclusivity over parcels of land for the purposes of discovering, evaluating and extracting shale gas and oil from the ground, changes to the existing plug-in vehicle program were announced which the government claims will be fairer to all.

As detailed in the official UK Government press release, the plug-in car grant has been given the go-ahead to continue beyond February 2016 until “at least the end of march 2018”. In total, £400 million of government funds has been set aside to make this extension possible, something which it says will treble the number of plug-in cars on the road between now and 2018.

The Mitsubishi Outlander PHEV meanwhile, will only be eligible for £2,500 in grants.

The Mitsubishi Outlander PHEV meanwhile, will only be eligible for £2,500 in grants.

Previewed earlier this year, the new plug-in car grant will differentiate for the first time between fully zero-emission vehicles and partial zero emission vehicles. From March 1 next year, those buying a plug-in vehicle with a zero-emission range of more than 70 miles per charge and a list price of less than £60,000 will be eligible for a £4,500 grant towards the purchase of their vehicle.

Those buying a plug-in vehicle with a zero-emission range of less than 70 miles will be eligible for a £2,500 grant towards the purchase of their vehicle.

Regardless of zero-emission range, plug-in vehicles costing more than £60,000 will not qualify for any government grants, a clear move to ensure that government funds are not spent helping wealthier buyers purchase high-end plug-in cars like the Volvo XC90 T8 plug-in hybrid, Porsche Cayenne Plug-in Hybrid, the Tesla Model X crossover SUV, and high-end variants of the Tesla model S Electric car.

While Tesla has yet to release its UK pricing for the Tesla Model X, it’s likely that the high-end crossover will have a list price in excess of £60,000 when it goes on sale in Europe next year. The Tesla Model S meanwhile, will be something of a grey area for those buying a plug-in car.

High-end Tesla Model S cars won't be eligible for a grant, but the entry-level Model S 70D will be.

High-cost cars with 70 miles of zero emission range are eligible for grants: high-cost plug-in hybrids with less than 70 miles of ZEV range are not. 

That’s because all Tesla Model S variants from the Tesla Model S 85D upwards have a list price above the £60,000 threshold. The entry level Tesla Model S 70D meanwhile, comes in at a list price of £56,200 before incentives, meaning that it should be eligible for a £4,500 government grant under the new scheme.

Also due to get a revamp come March is the grant scheme designed to help plug-in car owners install a dedicated charging point in their home. From March 1, the total amount payable under the Electric Vehicle Homecharge Scheme will fall to £500 per installation, a figure which the UK government says will cover around half the cost of installing a plug-in charging station.

In response to the reduction in charging station grant funds, David Martell, CEO of Chargemaster, a company which offers both domestic and commercial charging station infrastructure, called the move a “premature” one which was “a step backwards for UK carbon reduction.”

We should note however, that the drop in funding could help further reduce the cost of charging station infrastructure in the UK. While the cost of electric vehicle charging infrastructure has dropped dramatically in other key markets around the world where charging infrastructure is less heavily subsidized, the relative price of UK charging stations has remained relatively high.

Do you think the new grants are a good move? Will they impact sales of plug-in vehicles, or accelerate their adoption rate?

And what of the change in available funds for charging station installation? Leave your thoughts in the Comments below.

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