The investment will be used for research and development (R&D), charging infrastructure and car grants aimed at encouraging the public to purchase ULEVs.

Of the £500m, £100m will be used for R&D in ULEVs to reduce costs and improve charging technology, while £32m will be set aside for charging infrastructure including plans to install rapid chargepoints across the ‘M’ and ‘A’ road network by 2020.

To encourage more people to use ULEVs, car grants of £5,000 off the upfront cost will be extended, which amounts to around £200m of the investment.

In addition, local areas coming up with the most ambitious plans to incentivise drivers to take up ULEVs can win a share of £35m. Additional funding of £50m will also be available for local areas to invest in cleaner taxis and buses.

Announcing today’s investment, Clegg said: “Owning an electric car is no longer a dream or an inconvenience. Manufacturers are turning to this new technology to help motorists make their everyday journeys green and clean.

“This major investment is there to make driving an electric car affordable, convenient, and free from anxiety about the battery running out. But it’s also about creating a culture change in our towns and cities so that driving a greener vehicle is a no-brainer for most drivers,” added Clegg.

The Department for Energy and Climate Change says that the vehicles are fully capable of meeting the needs of today’s driver, particularly as the average journey made by motorists is “just seven miles, with the typical range of a pure electric car being around 100 miles”.

It also says that for longer journeys, there will be a rapid chargepoint, capable of charging a vehicle in 20 minutes, at every motorway service station by the end of 2014, and a network of 500 rapid chargers across the country by March 2015.

Production of ULEVs is a major part of growth both “now and for the future” and has helped the resurgence of the automotive industry since the recession, according to the Government.

Chief Secretary to the Treasury, Danny Alexander, said: “Ultra low emission vehicles bring together our most successful manufacturing sectors with our biggest long-term challenge – climate change.

“Britain can be the leading country in the world in developing, manufacturing and using ULEV. This half billion pound government investment will help to ensure we rise to the challenge,” added Alexander.

Today’s investment follows Clegg’s announcement in January that the government will invest more than £9m to boost the number of charging points for electric cars.

Figures released by the Department for Transport earlier this month, showed that in total, 4,359 new ULEVs were registered for the first time in the UK in 2013, up 25% from 3,491 in 2012. However, this still only represents around 1% of total UK vehicle sales.

Last week, breakdown service provider RAC launched its first mobile electric charging system to meet the needs of EV owners.

Earlier today, British Gas announced that it had successfully completed the UK’s largest electric commercial vehicle trial, with the company committing to take on 100 all-electric Nissan vans on a permanent basis.

Leigh Stringer

Action inspires action. Stay ahead of the curve with sustainability and energy newsletters from edie