The Energy Savings Trust is calling for construction firms to take advantage of new tax breaks that came into effect over the weekend and adopt greener company cars.

The UK could save almost £3bn a year if businesses switch to greener company cars, a study has revealed. The new Government tax breaks are for vehicles with 120g/km or fewer carbon dioxide emissions.

The findings form part of EST's new report, Behind the Wheel II. The study of 400 board-level executives at organisations across the UK pays special attention to those working in the UK construction sector.

The report found that just 29% of construction sector firms have a written travel policy while 55% have a Corporate Social Responsibility (CSR) or environmental policy. Only one in four senior executives working in construction allows his employees to choose their own company car within a price range, while one in five gives no choice at all.

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Department for Transport figures show that every year more than half of all new vehicles registered in Britain are company cars and Nigel Underdown, head of transport advice at EST, is calling on firms working in the UK construction sector to act now and "green" their company car fleets.

He said: "The reasons are there for all to see: running vehicles costs a lot of money and with fuel prices over £1 a litre it's not going to get cheaper any time soon. In addition, companies in the construction sector won't get far when tendering for big contracts unless they can prove their environmental credentials.

"There will be tax breaks for driving cars that produce fewer than 120g/km of CO2 or less and if someone driving an average company car opts for a car in this category, they could see their tax burden cut in half. I predict that 2008 will see a tipping point where offering - and choosing - low-emitting cars is the only sensible business option."

(GK/JM)