Exclusive: Mayor Boris and Mandelson mull electric car incentive scheme

Mayor of London Boris Johnson has undertaken talks with business secretary Lord Mandelson and environment minister Lord Hunt to discuss the possibility of introducing new incentives to encourage businesses to switch their fleets to low-carbon vehicles.

Under the government's vehicle excise duty banding system, electric and ultra-low-emission vehicles already pay no road tax, and are also exempt from the London Congestion Charge.

But according to a spokesman for the Mayor's Office, ministers are now considering further incentives to promote wider adoption of electric and low-carbon vehicles among businesses.

"The mayor is talking to Lord Hunt and Lord Mandelson about some sort of scheme to provide incentives to businesses to switch fleets to low-emission and electric vehicles," he said. "It would have the dual benefit of lowering emissions while stimulating the car market at a time when that would be very useful."

The Department for Business, Enterprise and Regulatory Reform was unavailable to comment at the time of going to press.

The revelation comes as the Mayor's Office sought to downplay reports yesterday from the Evening Standard that London would soon see an electric car hire scheme similar to that being implemented in Paris.

The high-profile Paris "Autolib" programme will see 4,000 electric cars sited across the city, which users will be able to hire at any time using their credit card.

Johnson said that London was keen to gauge the success of the scheme, but his office insisted that other measures to promote the use of electric cars were likely to be undertaken ahead of the launch of any hire scheme.

"Through the electric vehicle partnership the mayor is very committed to working with the industry and lots of different ideas are being looked at," said a spokesman for the mayor. "But as a model there are plenty of other approaches that are more likely to happen than that of a city buying thousands of cars and renting them out, with all the costs that are attached to that."

He added that the mayor was more focused on increasing the charging infrastructure to support the industry and working with the government to find new means to stimulate demand for electric cars.