Electric cars will be exempt from road user charges for four years, the Government said today as it moved to encourage people to use them.

Transport Minister Steven Joyce said light electric vehicles - those weighing up to 3.5 tonnes - were currently classed as diesel vehicles for the purpose of road user charges which meant they paid 3.6 cents to 4c per kilometre.

"The Government sees private vehicles continuing to be the most significant mode of transportation for most New Zealanders," Mr Joyce said.

"Therefore it is important that we encourage the use of alternative fuel technologies in order to help meet our environmental obligations over time."

Mr Joyce said combining highly efficient electric motors with New Zealand's competitive advantage in renewable electricity generation would reduce the greenhouse gases produced by the transport sector.

The exemption will be effective from October 1 this year and continue until 2013 when the Government will reassess it.

"There are very few electric vehicles currently in the fleet and the forgone revenue costs will not be significant," Mr Joyce said.

- NZPA