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Low-cost loans and scrappage scheme to convince drivers to buy electric could be on the cards

Currently the government offers €5,000 grant to someone looking to buy an electric vehicle.

Image: Alamy Stock Photo

LOW-COST LOANS and a scrappage scheme could be introduced to convince drivers to buy an electric car.

The long-awaited revised Climate Action Plan was launched today and sets out how it intends to meet tight climate targets over the next nine years.

The plan includes getting one million electric vehicles on the road by 2030. 

Speaking at today’s press conference in Government Buildings this evening, the three party leaders acknowledged that the cost of buying a new electric vehicle is still out of reach for many workers. 

Currently the government offers €5,000 grant to someone looking to buy an electric vehicle. Vehicle Registration Tax (VRT) changes were also made this year aimed at incentivising drivers to switch to electric vehicles.

However, Tanaiste Leo Varadkar acknowledged that the government may need to go further.

There is a need to balance the incentives and disincentives “in order to tip the balance in favour of people making the decision that is best for the environment”, he said.

The disincentive is the carbon tax, said Varadkar but he stated that grants and low cost loans need to improve.

While drivers know that an electric vehicle will save them money in the long-term, it means nothing to a person who can’t pay the upfront cost, he said. 

He said there are a lot of government backed loans for businesses, as well as home loans, whereby the interest rates are low and the repayments are spread over a long period of time. 

These could be extended for environmental activities, such as electric vehicle purchases. 

Varadkar said the government is not saying to anyone that they have to do this now or next year but over the next ten years, when a person is making the decision to change their car, the government want drivers to be encouraged to go electric. 

Transport Minister Eamon Ryan said the reality is that delivery of EVs is far faster than people expected three years ago. 

He believes it will accelerate rapidly over the next three years. 

“The tipping point is very close,” he said, adding that he thinks there will be radial change in the coming years. 

Increasing the number of electric cars on our roads is one aspect of the plan that Ryan said he believes will be slightly easier to achieve.

Varadkar said the last government toyed with the idea of a scrappage scheme whereby people would be encouraged to decommission their high polluting cars to move to electric, but ultimately it was decided not to go ahead with the idea.

At the time, he said it was judged that it would not be beneficial, said Varadkar but he indicated that the government will look again at the measure. 

“Sometimes you need to do things to kick things off,” he said. 

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Speaking to reporters today, he said this new plan will allow the government to examine those sort of actions again. 

Taoiseach Micheal Martin said the “gap has to be bridged” to enable people to make a decision to buy an EV so that it will be affordable to people. 

He said the government recognises that the cost is an issue for the average worker. Martin said the government needs to make sure the carrot is enough to change behaviour.

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