Thousands of drivers and businesses across the UK are set to benefit from lower prices after the government confirmed vital funding to support the transition to electric vans and trucks.
The Plug-in Van and Truck Grant, which had been due to expire next year, will now continue until at least 2027. The scheme currently provides:
Up to £2,500 off small electric vans
Up to £5,000 off large electric vans
Up to £16,000 off small trucks
Up to £25,000 off large trucks
Grant levels for the 2026/27 financial year will be confirmed in due course.
Supporting cost savings and growth
By switching to electric, businesses could save more than £2,800 a year on fuel alone, according to industry figures. The government says this extension will cut costs, expand sustainable operations, and help build stronger supply chains as part of its Plan for Change.
The UK logistics sector – which employs 1.2 million people and contributes over £79 billion annually to the economy – is expected to benefit most, smoothing the transition to zero-emission operations while creating jobs and new business opportunities.
Individual drivers also stand to gain, with grants lowering upfront costs and making EV adoption more accessible.
Government perspective
Future of Roads Minister Lilian Greenwood said:
“Extending these grants is another decisive step to power Britain’s transition to cleaner transport while backing the industries that keep our economy moving, driving new investment in EVs and helping businesses cut costs and expand. Every EV on our roads means healthier communities and new economic opportunities across the country.”
She added that with commercial transport responsible for more than a third of road CO₂ emissions, supporting operators to make the switch is “crucial to building a cleaner future for businesses and communities across the UK.”
Industry reaction
The announcement was welcomed by industry leaders.
Mike Hawes, Chief Executive of the Society of Motor Manufacturers and Traders (SMMT), said:
“Extending the Plug-in Van and Truck Grant until 2027 will help increase zero emission uptake in the critical commercial vehicle sector. Affordability remains one of the biggest barriers, so this extension will reduce upfront costs and, combined with faster charging infrastructure rollout, will help more operators make the switch. The next step must be more affordable energy so government can maximise the return on investment for both the environment and the economy.”
Supplier response
Suppliers and operators also stressed the practical benefits:
John Boumphrey, UK Country Manager at Amazon, commented:
“We welcome the government’s continued commitment to supporting the electrification of commercial fleets. Decarbonising the transportation network is a critical step to enable us to achieve our goal to reach net-zero carbon emissions across our operations by 2040.”
Checkatrade CEO Jambu Palaniappan added:
“This news is a big boost for tradespeople across the UK. Lower running costs, freedom from charges like ULEZ, and the ability to plan ahead with confidence – it all adds up to real, practical support. For many Checkatrade members, with help to switch to electric vans, they can keep moving, win more work, and build a future that’s both cost-effective and sustainable.”
Charging and wider support
The grant extension builds on other recent commitments, including a £30 million investment announced in July to install over 3,000 new chargepoints at UK depots. This sits alongside the £381 million Local EV Infrastructure fund, which will deliver more than 100,000 additional public chargepoints in the coming years.
With over 1.4 million EVs already on UK roads, more than 83,800 public chargepoints available, and the recently launched Electric Car Grant offering up to £3,750 off new EVs, government and industry are aiming to give businesses and drivers the confidence to commit to electric.