Written by Louis Sumner
The UK Government’s new Electric Car Grant (ECG) aims to make switching to electric more affordable, but only certain models qualify. The grant offers up to £3,750 off the list price for eligible vehicles, with a focus on affordability and sustainability.
Backed by £650m of funding, the scheme will run for 3 years. It forms part of the UK’s wider plan to ban the sale of new petrol and diesel cars from 2030.
How does it work?
From January 2025, qualifying EVs must be priced at £37,000 or less, have at least 100 miles of range, and meet strict warranty and sustainability requirements. These include:
- 8-year/100,000-mile battery and drivetrain warranty
- Verified science-based emissions reduction targets from the manufacturer
- Low carbon emissions in both battery production and vehicle assembly
The scheme is split into two tiers:
Band 2: £1,500 grant – meets most criteria but not the sustainability requirement
Band 1: £3,750 grant – must meet all criteria, including sustainability targets
Full list of eligible models (so far)
Band 1 – £3,750 (No models yet fully certified)
Band 2 – £1,500
- Citroën ë-C3, ë-C3 Aircross, ë-C4, ë-C4 X, ë-C5 Aircross, ë-Berlingo
- Cupra Born
- DS DS3, DS N°4
- Nissan Ariya, Micra
- Peugeot E-208, E-2008, E-308, E-408, E-Rifter
- Renault 4, 5, Alpine A290, Megane, Scenic
- Vauxhall Astra, Combo Life, Corsa, Frontera, Grandland, Mokka Electric
- Volkswagen ID.3
Only around 1 in 8 electric cars currently on sale qualify, meaning the grant is focused on making affordable EVs more appealing rather than subsidising premium models.
Transport Secretary Heidi Alexander said the scheme would make it “easier and cheaper for families to make the switch to electric”, while AA president Edmund King noted the bigger £3,750 discounts could help “bridge the financial gap” for many drivers.
Mike Hawes, chief executive of the SMMT, also welcomed the move but urged the government to process applications quickly to take advantage of the September sales surge.
Why these cars make the list
As many of you would have already noticed, the list is heavy on French brands (Renault, Peugeot, Citroën) and UK/European-made Vauxhalls, along with value-driven Chinese brands like MG. This isn’t accidental. The grant’s price cap and sustainability rules naturally favour manufacturers producing cost-effective EVs at scale.
Meanwhile, Chinese brands are making a strong push into Europe, partly because of high US tariffs. Models like the MG4 and MG5 meet the affordability criteria, but some may struggle to meet the stricter Band 1 sustainability requirements.
What this means for you
If you’re considering a new EV under £37,000, now’s the time to explore options. While the top grant tier is currently empty, more models are expected to qualify throughout 2025, starting with the next-gen Nissan Leaf built in the UK.
In the meantime, plenty of capable EVs qualify for the £1,500 Band 2 discount, from city-friendly hatchbacks like the Fiat 500e to family-friendly crossovers like the Peugeot e-2008 or Vauxhall Grandland Electric.
