The Transport Agency has spent more than $180,000 advertising the Clean Car Discount during July, the first month of the policy.
The advertising paid for print and radio ads, as well as posters, flyers and Google ads online.
The Taxpayers' Union said it was a waste of money because the policy received so much media attention advertising was not needed.
Some of the full-page advertising the agency paid for read: "Over $8000 off a new electric vehicle? That's an EV decision."
Louis Houlbrooke, a spokesperson for the Taxpayers' Union, said it was a massive waste of money.
"The issue here is this assumption that government departments have that they need to launch into a huge taxpayer-funded information campaign for every policy," he said.
"This one in particular obtained enormous media coverage, our politicians were debating it, it's not like New Zealanders were not aware of this policy."
A breakdown of the costs show almost $30,000 went into developing the campaign with advertising company Clemenger BBDO, $34,000 was spent on print advertising, $50,000 on radio ads during a three week period, $5000 on posters and flyers, $27,000 on google ads, and almost $35,000 on content partnerships, or sponsored content, which ran in Stuff and NZME mastheads.
Houlbrooke was particularly unhappy with the sponsored content.
"In the top right it says sponsored content by Waka Kotahi. Now for someone who's looking at an article like that at a glance they probably don't even read that, so it's not transparent enough in our view.
"At the very least you'd hope that the Waka Kotahi logo would be in there somewhere, but no, these look like normal articles when they're really taxpayer-funded promotions."
In all, the campaign included 21 half or full -ads in daily or weekend papers, and radio ads on 24 stations around the country.
The Transport Agency's general manager of Safety, Health and Environment, Greg Lazarro, told RNZ in a statement that it was money well spent.
"The cost of the campaign represents a very small fraction of the government's significant investment encouraging the use of low emissions transport, which is expected to reach up to $25 million per year by 2023-24.
"In the first month of the scheme there were 1944 EV and hybrid light vehicles registered in New Zealand, compared to 521 in June."
Lazarro said the purpose of the campaign was to refer people to the Transport Agency's Clean Car Discount website, where they can get more information about how to apply for rebates, and if they are eligible.
But Houlbrooke was less convinced, saying some of the ads seemed more like they could have been for car companies.
"In a promotion like this you'd expect the car companies are already running these kinds of ads.
"It's unclear why the government or why the taxpayer needs to step in to spend 200 grand promoting a discount on a new car."
For comparison, while the Transport Agency spent just over $180,000 in advertising in July on the Clean Car Discount, the Energy Efficiency and Conservation Authority has spent at least $400,000 on its Gen Less campaign, encouraging people to use less energy at home, at work, or on the road.