The Government’s Office for Zero Emissions has increased the limit on Plug-in Van Grant (PiVG) orders but the fleet industry has reemphasised the challenges being faced by van operators in their transition to zero-emission solutions.

The BVRLA said the grant extension was a positive step but it’s calling for an Electric Van Plan

The grant was launched in 2012 to help bridge the price gap between the cost of ultra-low emission and diesel vans and currently offers up to £2,500 for small vans and £5k for large vans, available on eligible vehicles and with the discount included by the seller in the purchase price.

In December 2021, OZEV implemented a limit of 1,000 PiVG orders per end customer, per financial year, “to ensure best value for money for the taxpayer, as well as ensuring budgets were protected and distributed as fairly as possible”. This has now increased to 1,500 with immediate effect and until further notice. OZEV said the changes was in response to market conditions and that it was keeping the grant under continual review. If demands exceed projections, the previous order limit of 1,000 or an alternative limit per financial year could be introduced without notice.

The BVRLA said the increased limit was a positive step but was also indicative of the challenges being faced by van operators when looking to move away from diesel – and it’s called for action to address these.

Latest SMMT data on new van registrations show battery electric vehicle (BEV) uptake soared in April, up 62.6% to 1,494 units, giving a market share of 6.6%. But the trade body has downgraded its 2023 BEV market share forecast – from 8.6% to 7.4% – against the challenging economic backdrop as it warned that high energy costs, limited incentives and inflationary pressures mean that the important total cost of ownership calculations are often negative.

The BVRLA has also outlined where it thinks support is required to enable the transition and ensure net zero targets can be met, as it warned that van fleets are struggling to make the zero-emission transition and the 2030 phase-out target for petrol/diesel vans is “at serious risk”.

Gerry Keaney, chief executive, said: “Fleet-friendly public charging infrastructure is scarce and operators are struggling to find electric vehicles that can match their diesel counterparts when it comes to cost of ownership, payload or range.

“The Government is listening and today’s Plug-in Van Grant extension will be welcomed by the largest fleet operators. The grant is a vital tool in bringing more electric LCVs to UK roads, but it is not a silver bullet.

“The ZEV mandate that comes into force next year will encourage manufacturers to produce more affordable and capable electric vans. In the meantime, we need to see a huge effort in rolling out a more affordable, reliable and accessible van fleet-friendly charging infrastructure. We need a new Electric Van Plan.

“The BVRLA continues to campaign on this topic and is in regular contact with OZEV and other bodies to share the concerns of van operators and drivers. Our ongoing research projects are quantifying these challenges and giving tangible solutions that we are working to implement.”

The National Franchised Dealers Association (NFDA) also said the PiVG order limit extension was a positive move as  it “sends the right message to retailers that the Government wants more zero-emissions vehicles to be sold and that they are willing to support this with financial incentives” with some vans being sold at a 35% discount.

But chief executive Sue Robinson added: “Whilst this is a move in the right direction, NFDA is concerned that a great deal more could be done to promote and incentivise the transition to electric.

“There is still a deeper-rooted issue with the UK’s charging infrastructure network and this remains a key barrier to entry for many that have concerns on this issue. The Government needs to match the efforts and investments retailers have made in preparing their showrooms, stock and staff for the 2030 deadline.”