In last month's announcement, Transport Secretary Lord Adonis launched a new incentive to allow private and business fleet buyers to receive 25% off the price of an ultra-low carbon car, up to a maximum of £5,000.

However, GE Capital says that, despite previous and longstanding Government backing for alternative fuels, the latest Company Car Trends report from GE Capital's Fleet Services business shows that the majority of fleets still use core fuel types, with diesel (85%) being the dominant fuel choice due to the associated low CO2 emissions and high MPG performance. In fact only 2% of vehicles in the surveyed fleets are electric.

Whilst these statistics clearly call into question the success of previous measures that have been put into practice, the challenges faced by electric vehicles concerning infrastructure and range capability remain and, as such, they will continue to be  "marginal" vehicle for fleets in the short to medium term. However, 54% of fleet managers do see environmental issues as an important consideration, reflected in more than one quarter (28%) of respondents investing in hybrid vehicles for their fleets.

Gary Killeen, UK Fleet Commercial Leader, GE Capital, said: 'We are pleased to see the Government continually encouraging companies with clear, long-term incentives to adopt environmentally-friendly cars and vans. However, to repeat the comments on everyone's lips at the moment, more work must be done on the infrastructure and technological needs to make them appropriate for fleet usage.'

He added: 'Whilst designating the Midlands region as a new Low Carbon Economic Area and installing 1,000 charging hubs nationwide over the next three years are both great moves towards a low carbon economy, the Government needs to rapidly advance their plans in order to make a real impact on business vehicles.

'Due to the typical usage profile it is unlikely that the number of companies choosing electric vehicles will significantly rise within the next few years as the technology will not be there to support them.'