Ahead of the Budget speech, the Government has announced an incentive for consumers to buy electric cars of between £2000 and £5000.

The incentive will kick-in in 2011 and, according to Geoff Hoon, transport secretary, would mean "an electric car is a real option for motorists".

Full details of the scheme remain unclear. The Department for Transport is to begin discussions with the motor industry and financiers to work out how best to deliver it. In particular there is no detail as to whether the incentive would be available to corporate buyers - or whether it would apply to light commercials, where several UK companies are already successfully marketing product.

The incentive is part of a £250 million, five-year plan to deliver low-carbon transport through support for an infrastructure of charging points and research and development costs.