£1bn government boost to cut fleet costs and accelerate EV transition

The UK government has unveiled a £1 billion funding package to help businesses transition to electric vans and trucks, aiming to cut costs, drive growth, and reduce emissions across UK roads.

The announcement includes continued support through the Zero Emission Truck and Van grants alongside a £170 million expansion of the Depot Charging Scheme (DCS), tackling two of the biggest barriers to electrification: upfront vehicle costs and access to charging infrastructure.

Businesses can save up to £81,000 on the heaviest zero-emission trucks, covering up to 40% of the purchase price, while grants of up to £5,000 remain available for electric vans. In addition, companies and public sector organisations can receive up to £1 million, or 70% of costs, to install depot-based charging for vans, coaches, and electric HGVs.

“This £1 billion investment cuts costs for British businesses, supports jobs, cleans up our roads, and gives operators protection against shifting global fuel prices,” he said.

The logistics sector – worth £170 billion and supporting 2.7 million jobs – has been under pressure from global fuel price volatility. The new measures aim to build resilience by reducing reliance on fossil fuels and accelerating the shift to electric fleets.

Industry leaders have welcomed the move. British Vehicle Rental and Leasing Association (BVRLA) highlighted the importance of charging infrastructure support for fleet operators.

“The Depot Charging Scheme is playing a vital role in helping fleet operators and rental companies to install affordable, reliable charging infrastructure at their depots.

“The vehicle rental sector faces one of the most challenging paths to decarbonisation, and this additional support for depot charging will play a major role in building confidence. It will encourage more rental operators – particularly SMEs – to electrify at scale, reduce costs, and contribute to the UK’s net zero goals.”

Major businesses are already benefiting from earlier government support, with companies such as Wren Kitchens and Bedrooms and Marks & Spencer investing in electric fleets and charging infrastructure to reduce costs and emissions.

The funding forms part of a wider push to accelerate EV adoption, alongside over £600 million earmarked for public charging infrastructure and ongoing support for private motorists through the Electric Car Grant.

With electric vehicles now accounting for around one in four new car sales, the government says the latest investment will help ensure UK businesses remain competitive while progressing towards net zero targets.