The Chancellor, Philip Hammond, has announced £375m in additional support between 2017 and 2021 to accelerate the transition to ultra-low emission vehicles (ULEVs) in the Autumn Statement.

The funding includes £150m to create a cleaner bus and taxi fleet; £80m towards electric vehicle charging infrastructure; £40m of additional support for the Plug-In-Car Grant and £20m for development of alternative fuels for HGVs and aviation.

Hammond also announced that the investment will be supplemented by tax measures to support ULEVs, such as a two-year 100% first-year allowance for companies that install electric chargepoints and ensuring that ULEVs are protected from the removal of tax advantages for salary sacrifice.

He said that the Government will also expand the number of Company Car Tax bands for ULEVs from 2020-21 onwards, with lower rates for those who choose the cleanest cars.

The Treasury says that these initiatives “will help maintain the lead in manufacturing that has seen the UK build a quarter of all the ULEVs sold in Europe”.

Andy Eastlake, managing director of the Low Carbon Vehicle Partnership (LowCVP), welcomed the support for the ULEV agenda in the Autumn Statement and particularly the substantial investment in greener buses and taxis.

He said: “The funding announcements and tax incentives are a clear signal of the Government’s ongoing commitment to the low emissions transport agenda. These measures will encourage vehicle demand which will further strengthen and support the development of the UK’s manufacturing base.

“LowCVP will continue working with the Office for Low Emission Vehicles (OLEV) and other stakeholders to ensure that progress in reducing emissions in trucks and vans matches advances made in other areas of road transport.”