Cash towards trip to electric avenue

Transport Secretary Philip Hammond gets out of a Smart Fortwo car, during the launch of a Plug-In Car Grant designed to stimulate demand for eco-friendly vehicles.

The promised handout of up to 5,000 towards the cost of an electric or ultra-low carbon car has survived Government cuts.

Mr Hammond said the funding, first announced by the Labour government, will go ahead from January 2011.

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The grant will reduce the cost of new ultra-low carbon vehicles by 25 per cent, capped at 5,000. The incentive has been agreed until the end of March 2012.

The Department for Transport said the announcement of the incentive had been made before the completion of the autumn spending review to support the early market for ultra-low carbon cars.

The grant covers electric, plug-in hybrid or hydrogen fuel cell cars.