The costs involved in running a car seem to be forever increasing with every year, and more and more people are looking at every aspect to see if they can make any savings.

Fortunately to an extent, we can control the prices we pay. The majority of running costs of a car can be affected by the choices we make. Including things such as the fuel our cars use and their performance, to name a few.

However no matter how hard you try or where you look, all running costs such as the price of the vehicle, car insurance, fuel, replacements/repairs, breakdown cover, MOT’s and servicing can only be reduced so far, except for road tax.

Road tax prices for vehicles in the UK are based on either their engine size, such as for motorbikes, weight or engine size for light good vehicles and CO2 emissions for cars. Of course, the bigger the engine, the heavier the vehicle or the more polluting the vehicle is, the more the road tax will be.

Fortunately, in regards to CO2 emissions, if your car is deemed to be ozone friendly, then you’ll be exempt from paying road tax, potentially saving hundreds of pounds a year. Not only do you not pay tax, if your car is in a tax free band, it usually means that it is very fuel efficient, saving you frequent trips to the pumps.

The UK government are very keen to get as many people as they can to have economical and more environmentally friendly cars, to the extent that they will be starting the Plug-In Car Grant scheme from January 2011. The grant will be available to anyone looking to buy a car that meets certain criteria and uses the best available fuel technologies, including:

• EV’s – Electric vehicles that run completely on batteries and must be plugged in to recharged
• Plug in hybrids – Petrol or diesel models that can be plugged into the mains
• Hydrogen fuel cell – Hydrogen powered cars may be considered for the scheme
• Other green fuels may be considered

The grant will be available from January 2011 and will cover 25% of the cost of the car, up to a maximum of £5000. This level has been agreed until the schemes review on the 31st March 2012.

To be eligible for the grant, the chosen car must be powered by any of the green fuels mentioned and must also meet the following criteria:

• Only new cars (vehicle category M1), including cars converted from internal combustion engines by specialist before the cars first registration.
• Not classed as a van, quadricycle or motorbike
• EV’s must exceed a range of 70 miles before a charge is required, 10 mile electric range for a plug in hybrid
• CO2 emissions must be less than 75g/km
• 60mph minimum top speed
• 60,000 mile or 3 year standard warranty
• 3 year electric drive train (parts that transfer power to the wheels) and battery warranty. Must also have the option to extend this warranty by another 2 years
• Minimum 5 year warranty on the battery, or evidence to show reasonable battery performance after 3 years of use
• Must comply with electrical regulation UN-ECE Reg 100.00
• Either a EC whole vehicle type approval or evidence that the car has an internationally recognised appropriate level of safety

The initial cost of green cars can be quite expensive; therefore the Plug-In car grant has been designed to try and offset this cost slightly, to make buying an emission free car more appealing to road users.