The BBC's Politics Show has learned that, this week, the government will announce plans to buy a number of electric cars and vans for a new pilot scheme. Its aim is to see how these vehicles fare on Britain's roads.
Ministers hope the trials will take place in three cities, and the information collected from drivers taking part, will be the basis of bigger plans.
In total, the whole package will cost around £100m.
Car makers will be invited to bid to supply the vehicles for the pilots.
Electric vehicles are emissions free, and those available on the market usually cost between £9,000 and £12,000, and once fully charged can travel up to 40 miles.
The government says the money is a worthwhile investment, bearing in mind the UK is now committed to cutting all greenhouse gases by 80% by 2050 - that about 20% of those emissions come from road transport, yet of the UK's 26m cars only 0.01% are electric.
While environmentalists agree cash urgently needs to be pumped into research and development - some want to know why the Taxpayer is footing the bill.
It's crazy that the government is subsidising the motor industry for what it should be doing anyway
Author and environmental journalist, George Monbiot, says it is a scandal.
He says: "It's crazy that the government is subsidising the motor industry for what it should be doing anyway. Years ago, in 1998, the industry promised it would make a radical cut in the amount of carbon dioxide its cars are producing.
"It has broken that promise, and now the government is paying it to do what it should have been forced to do through regulation."
At the moment not a single major manufactures sells electric cars in the UK.
Rather than force the issue, George Monbiot says the government is providing a sop to an already wealthy industry: "Subsidies are what government's pay when they don't have the guts to regulate powerful industries.
"Instead of saying - you must do that and we are the government and we are telling you what to do, they are saying we will pay you a bribe please go ahead and do it.
"There isn't even any guarantee that this bribe will produce the right results."
The body that represents motor manufactures strongly rejects this accusation.
It's vital the government makes the UK a good place to do business
Government action vital
Paul Everitt heads the Society of Motor Manufacturers and Traders and insists that the big car makers are spending billions on developing green technology.
But he adds: "It's vital the government makes the UK a good place to do business."
Global vehicle manufactures are just that, they are global.
"They have got huge numbers of markets around the world in which they operate and they have a choice about where they do research, development and demonstration.
"Making the UK a more attractive location for that kind of work is good for the economy and will make sure we are part of the low carbon future.
Aside from who pays, questions are being raised about the timing of this scheme.
As we head into recession, the tension between doing what is best for the economy versus what is best for the climate could be a problem for the government.
Just this last week, Gordon Brown, insisted petrol companies drop prices at the pumps to help hard-up consumers.
Of course, these are the very pumps that provide the fuel for the cars that are polluting our environment.
We're absolutely clear that we want to see low carbon and a new range of vehicles employing more hybrid more electric technologies
However, The Transport Secretary, Geoff Hoon, denies long term targets will be set aside for short term benefits.
"We must look at these things," he says, "not only in terms of the impact on the environment but actually in terms of the impact of our economy and the truth is using low carbon vehicles can often be a great deal cheaper than using their carbon emitting counterparts, so looking at ways in which we help to develop that market is the right position for government to be in even in these difficult circumstances."
But is there a chance that the government is in danger of sending mixed messages to consumers?
No, says the Transport Secretary: "I don't believe so at all, we're absolutely clear that we want to see low carbon and a new range of vehicles employing more hybrid more electric technologies, we believe that's something the consumer wants to see as well."
But one consumer experts says, even if there is a will - as the credit crunch bites - there may not be a way.
With new car sales down 25% compared to 2007, motorists are feeling the pinch.
I think demand for electric cars will increase
Editor of "What Car?" Magazine, Steve Fowler, says if the government is hoping to help stir demand for electric cars, they may not have chosen the best moment.
"I think demand for electric cars will increase," he insists, "a lot of the major car makers will bring electric cars to market but you can't force people to buy these cars and times are tough at the moment.
"You're struggling to force people to buy anything - certainly cars, the car market is really down and of course electric cars are only part of the solution, they're fine if you're only gonna be driving in town, not so good further afield."
But as car buyers struggle with credit - some argue the government is struggling with credibility.
Promoting electric cars, critics say, only makes sense if other sources of pollution are tackled simultaneously.
We think high speed rail networks can help secure better transport for the future
"The government's policy when it comes to tackling climate change, simply isn't joined-up", says Shadow Climate Change Minister, Greg Clark.
"They're signing up quite rightly to targets, but at the same time planning for a third runway at Heathrow and expanding the capacity at Stanstead.
"We think high speed rail networks can help secure better transport for the future and help us meet our targets for reducing emissions."
While most politicians, environmentalists and car makers agree that the UK should be heading towards the widespread use of zero-emission vehicles - exactly how to get there remains a vexed question.
As we head into recession - the trick for the government is to ensure that its plans do not hit the skids altogether.
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