Car Insurance
Government drops green driving incentive
Fri, 09 Jun 2006
The government has announced that it will not introduce grants for people to convert their cars to hybrid technology, but will instead explore new avenues of encouraging greener transportation.
Plans for a Low Carbon Car Fund were last month approved by the EU state-aid monitors, leading the car industry to expect the imminent introduction of grants to convert cars.
However, the government has since decided that it will not pay for people to convert their cars, but has hinted it will invest directly in car-industry research, such as with Peugeot's recent hybrid engine development.
The car industry has reacted with anger to the news. Head of the Society of Motor Manufacturers and Traders, Christopher Macgowan, said: "We are stunned by this decision. It sends completely the wrong message to consumers and the industry at a time when government claim to be taking a lead on lowering carbon dioxide emissions."
In addition to grants to convert petrol or diesel cars to hybrid technology a number of car insurers had mooted introducing so called green car insurance.
Customers would be offered financial incentives for converting to cleaner cars, such as carbon offsetting and cheap insurance, although with the government's withdrawal of grants it is not known whether insurers will persevere with the plan.
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