The UK Government has announced that next year some electric car buyers would receive grants of up to £5,000.

The measure, which comes in the effort of cutting emissions and encouraging green transport, will go into effect on January 1st. The grants will be available to thousands of electric car buyers and will effectively cut the price of such vehicles by around 25%.

The first models eligible for Government grants include the Mercedes-Benz smart fortwo ED, Citroen CZero, Nissan Leaf, Mitsubishi iMiEV, Vauxhall Ampera, Toyota Prius plug-in, Chevrolet Volt, Tata Vista EV and the Peugeot iON. To the surprise of many, the high performance Tesla electric vehicle has not been selected.

Government officials have set aside about £300 million for the grants over the next four years, which will cover grants for about 60,000 electric vehicles. The announcement of a new £20 million Government plan in the effort of installing plug-in stations in major British cities is expected to follow shortly.

Transport secretary Philip Hammond said that it was only a few years ago that super-low emission vehicles with widespread market appeal were simply a pipe dream. Now, he said, they’re a reality and 2011 could be seen as the year in which electric vehicles really took off.