The OZEV (Office for Zero Emission Vehicles) Plug-In Van Grant reduces the purchase price of eligible new electric vans. If you're also financing your van purchase, you need to understand how the grant interacts with different finance structures - because the interaction varies, and getting it wrong can mean either losing the grant or creating a compliance issue.
How the OZEV Plug-In Van Grant Works
The grant is applied at point of sale by the vehicle dealer, reducing the invoice price by a fixed amount per eligible vehicle. The dealer claims the grant back from OZEV directly - you simply see a reduced purchase price on your invoice. The grant is available only on eligible new vehicles meeting the OZEV criteria (range, price cap, emissions). Check current eligibility and grant values at the time of purchase, as these change.
OZEV Grant + HP (Hire Purchase) - Works Cleanly
Under HP, the grant reduces the purchase price before finance is applied. You agree a deposit, the grant-reduced price is the asset value, and you finance the remainder at the agreed HP rate. This is the cleanest and most straightforward combination. Lenders are comfortable with it and there are no structural complications.
Example: OZEV grant + HP
Electric van list price: £40,000 OZEV grant: £2,500 Post-grant price: £37,500 Deposit (10%): £3,750 HP finance amount: £33,750 Monthly HP payment (5.5% APR, 4 years): approx. £790
OZEV Grant + Finance Lease - Works, with a Caveat
Under Finance Lease, you don't own the vehicle - the finance company does. The grant is still applied to the purchase price (reducing what the finance company pays for the asset), which in turn reduces the finance amount and your monthly rentals. The finance company is the registered owner, so they receive the benefit of the reduced purchase price, which is passed on to you through lower rentals. This works, but it's worth confirming with your specific lender at application stage.
OZEV Grant + Contract Hire - Works
Contract Hire is similar to Finance Lease - the lessor owns the vehicle. The grant reduces the lessor's acquisition cost and is typically passed through to you as lower monthly rentals. Works straightforwardly with most contract hire providers.
OZEV Chargepoint Grant - Finance Interaction
Separately from the van grant, OZEV's Workplace Charging Scheme (WCS) provides up to £350 per socket towards the cost of workplace EV chargepoints (up to 40 sockets). If you're financing both your electric van and your charging infrastructure, these can be handled separately - most lenders are comfortable financing charging equipment as a standalone piece of business equipment.