Under the scheme, which started on the 1^st of January, individuals and businesses can apply for discounts of 25% on the price of a new electric vehicle, up to a value of £5,000. In its first three months, 465 cars were registered as part of the scheme, compared to 215 for the second quarter.

If all 680 vehicles were bought with the full £5,000 subsidy, they would account for £3.4m of government funding, out of a total of £43m set aside. There are now 2,500 electric vehicles in the UK, against a fleet of 28 million conventionally powered cars and vans.

Professor Stephen Glaister, director of the RAC Foundation, commented: ‘Despite the lower fuel costs associated with electric cars, the high purchase price means it will take owners several years to reap the financial benefits of not choosing fossil-fuel powered vehicles. In the short term motorists will have to think long and hard about whether electric cars give better value for money than the best conventional and hybrid models.
 
‘There are three big questions for the future. Will the cost of EVs come down? How long will batteries last? And what will happen to petrol and diesel prices? The sums are going to change significantly but no one can be sure how. Add depreciation to the equation and you see the economics of green motoring is a grey area.
 
‘It will be interesting to see how Renault’s plan to lease electric vehicle batteries to consumers rather than sell them will take off. Certainly it will reduce the upfront costs.’