UK Will Offer Incentives to Encourage Electric, Hybrid Vehicle Sales
By Greg Johnson April 16, 2009Cash For Clunkers Program Could Be Next On The United Kingdom's Agenda
The United Kingdom today announced a plan to "help put electric cars into the reach of ordinary motorists" by offering consumers as much as $7,500 in government-funded vehicle purchase incentives.
"The scale of incentives we're announcing today will mean that an electric car is a real option for motorists as well as helping to make the U.K. a world leader in low carbon transport," said Transport Secretary Geoff Hoon.
The five-year program to encourage sales of electric and hybrid vehicles that was unveiled today by Hoon and U.K. Business Secretary Peter Mandelson is part of a $370 million plan to deliver what officials described as "a green motoring transformation."
The incentives that will run from $3,000 to $7,500 are in line with what Washington, D.C. has approved in this country. The green package also includes $30 million to fund "charging points and related infrastructure to help develop a network of 'electric car cities' throughout the U.K."
U.K. officials said that the incentives would be available when the first electric and plug-in hybrids "hit the showrooms, which we expect from 2011 onwards."
"Less than 0.1% of the UK's 26 million cars are electric so there is a huge untapped potential to reduce emissions," Hoon said.
That's all for the good, according to Global Insights, an economic forecasting company.
But the emissions-reduction scheme will only work if the U.K. can generate more electricity from low-carbon or renewable sources. The U.K.'s only realistic alternative, Global Insight states, is nuclear power, "and the government faces significant opposition to its plans to increase nuclear power provision to the national grid."
Global Insight concludes that the nation's electric grid "is likely to witness significant extra demands on it if there is significant uptake of the electric car scheme. The national grid's biggest contributor remains coal-fired power stations, the biggest single source of industrial CO2 emissions."
Global Insight also describes the $370-million incentives fund as "actually very small in terms of making a significant difference to the overall transport mix, while the figure of ($30 million) allocated to installing charging points appears minuscule."
Next up for the U.K.: Debate over a cash-for-clunkers program akin to what legislators in several European countries have adopted in order to persuade consumers to trade in old, inefficient cars for new, fuel-efficient models with fewer tailpipe emissions. (The U.S. is considering a similar plan.)
Media reports suggest that legislators are divided on the proposal. Business Week reports that the Sunday Times of London has cash-for-clunkers in line for approval on April 22. The Sunday Telegraph reports that the government has reject the proposal.The BBC splits the difference by suggesting that cash-for-clunkers "is likely" to be approved.
We're in favor of the U.K. (and the U.S., for that matter) adding cash-to-clunkers to the list of green ideas. But the program must be approached sensibly. Properly constructed cash-for-clunkers legislation can help struggling automakers as well as help to clean up the air.
Greg Johnson, Contributor
LEAVE A COMMENT