With lower than eight years before the Government bans the sale of recent petrol and diesel cars from 2030, the push to get people to modify to greener vehicles is already well underway.
Ministers and EV-advocates have hailed the cheaper cost of recharging over filling up with petrol and diesel as probably the most compelling selling points for making the transition to a battery-powered model today, and demand for electric cars has been booming in consequence.
Nonetheless, with news that energy prices will soar again from October and predictions for further increases, this can undoubtedly put a dent in cost-saving advantages of running an electrical vehicle versus a automobile with a petroleum engine. But by how much?
The fee of charging an electrical automobile at home is ready to rise by as much as £500-a-year: We have crunched the numbers on EV running costs ahead of the energy price cap increase from 1 October for individuals who can plug in at home and people who cannot
Ofgem’s announcement that the energy price cap might be increased from 1 October will mean spiralling household bills for Britons. And analysts have predicted that, without government intervention, they’ll proceed to remain sky-high in 2023.
For those who own an electrical automobile or plan to purchase one imminently, the running costs related to a plug-in model will likely rise in consequence.
The regulator on Friday confirmed it’s increasing the energy price cap on 1 October by £1,578 a 12 months – or 80 per cent – from £1,971 to £3,549 for a household on a default tariff paying via direct debit.
Under the present price cap, electricity costs to the closest pence is as high as 28p per kilowatt hour with a standing charge of 45p per day.
October’s hike will see this rise to 52p per kWh and the day by day standing charge upped to 46p.
What does this mean for electric automobile charging costs for individuals who can – and people who cannot – plug their zero-emission vehicles into sockets at home?
What impact will the energy price cap hike have on EV charging costs?
For electric automobile owners who’ve an charger at home and use their domestic tariff to cover the fee of boosting their EV’s battery, the impact of the increased price cap will rely upon various various factors.
These include the EV they own and its battery size, what number of miles they drive, their charging device, the kind of energy tariff they’ve and time of day they often charge up.
To place the rising cost of electricity into context, we have now based our calculation on the charging costs for the favored Volkswagen ID.3 powered by the mid-level 58kWh battery, which within the UK is currently priced from £36,195.
We’ve then compared it to the fuel costs for a similarly-sized VW Golf family hatchback with a 1.5-litre petrol engine, which starts from a more cost-effective £25,950.
For comparative purposes, we have now calculated the difference in annual home charging costs for an electrical Volkswagen ID.3 (left) and yearly fuel bills for a petroleum Volkswagen Golf hatchback (right)
Most homechargers offered to customers today are 7kWh devices, so we have now used this as our benchmark for the calculation.
In a ‘worst-case scenario’ where an electrical automobile owner pays 52p per kWh to charge, boosting the ID.3’s battery to 100 per cent from 1 October will, in theory, be £30.67.
At the present cap price of 28p per kWh, a full charge is £16.69, meaning an additional £13.98 every time the batteries are replenished.
The electrical VW has an official range of 265 miles, though expect to realize less under real-world driving conditions.
Using this figure for representative purposes, the fee per mile for the ID.3 will rise from 6.3p to 11.6p when the value cap is hiked in a month’s time.
For drivers covering a median of 10,000 miles a 12 months, they’ll have to charge their ID.3 a minimum of 38 times. This takes the overall annual charging cost from £634 today to £1,165 from 1 October – a jump of £531.
Worst-case scenario VS best-case scenario for EV home charging costs
We cannot stress enough that the above calculation is predicated on a worst-case scenario.
The chances are most EV drivers will charge their cars overnight during cheaper off-peak hours and can have shopped around for the most cost effective fixed rate energy deal that guarantees them lower domestic electricity pricing.
Some might need been fortunate enough to have taken advantage of EV-specific energy tariffs which have until recently been available.
Quite a few providers were offering these dedicated EV-tariffs a 12 months ago, though just about all of them have since pulled availability to latest customers in response to rising energy costs – the most recent being EDF Energy, citing ‘ongoing energy market volatility’.
Only Octopus Energy currently offers a low fixed-rate EV tariff, providing off-peak rates of seven.5p per kWh when charging an electrical automobile throughout the hours of 11:30pm and 5:30am.
That is 44.5p less during that six-hour window than the value cap high of 52p per kWh from October – though an Octopus spokesperson told us that its pricing is all the time under review, suggesting it may not stay that low for long.
There’s currently just one dedicated electric automobile tariff available with Octopus Energy. Customers with an EV can profit from low-cost off-peak charging rates of seven.5p per kWh between 11:30pm and 5:30am. EDF Energy has recently ended availability of its similar tariff due ‘ongoing energy market volatility’
How do higher EV home charging costs compare to fuel bills for a petroleum automobile?
Now we know the way much it could cost to run an electrical automobile from 1 October, how does this fair against an equivalent petrol model?
The 1.5-litre petrol VW Golf we have used for comparative purposes has a 50-litre fuel tank and has an ‘official’ – lab-tested – range of just over 50mpg. It means it might probably travel for 550 miles when brimmed with unleaded, though realistically – just like the ID.3 – the range might be lower than this in normal driving conditions.
Based on current fuel prices (unleaded at 170.4p a litre on Thursday 25 August) it costs £85.20 to fill the tank of this popular family hatchback.
Due to this fact, the fee per mile is 15.5p, which is nearly 4p-a-mile greater than the worst-case scenario for the VW ID.3 that is charged at home for 52p per kWh.
The Golf will must be filled up with fuel 19 times a 12 months to cover 10,000 miles over the course of 12 months, which works out at £1,619 – that is £454 greater than the domestic charging costs for the electrical ID.3.
After all, fuel prices are subject to day by day fluctuation, so the difference in costs could change dramatically over the course of a 12 months.
For electric automobile owners without off-street parking who’re reliant on the costlier rapid public network of devices, the annual charging cost premium is £634. This might push EV charging costs above yearly fuel bills for a petroleum automobile
What impact will the energy price cap hike have for EV drivers who cannot charge at home?
Around a 3rd of properties within the UK wouldn’t have off-street parking.
For EV drivers on this predicament, they’re heavily reliant on the network of public chargers, of which there are only over 32,000 within the UK, based on latest government statistics. They usually’re much pricier to make use of in comparison with charging at home.
Almost every public charging operator has already increased their prices once this 12 months in response to the broader energy crunch – by as much as as much as 15 per cent in some cases – and charges are expected to rise again within the construct as much as winter.
Most recently, Instavolt increased its prices for a fourth time in only 10 months, with rapid devices upped from 57p to 66p per kWh (a 16 per cent rise), saying ‘record-high’ energy costs had left it no selection but to pass these higher costs onto customers. Shell has also hiked its prices in August from 49p to 65p per kWh for rapid charging – an increase of 32 per cent.
A recent study by Electrifying.com says the present difference in annual charging costs in the event you’re only using the general public infrastructure when put next to plugging in at home can already be as much as £1,250.
The report found that the average cost for pay-as-you-go customers to make use of the UK’s public rapid charging infrastructure in August is 53p per kWh.
With that being only 1p higher than the domestic price for a household on a default tariff paying via direct debit from 1 October, its inevitable that operators will increase these usage rates inside a matter of weeks as their very own energy costs skyrocket.
We must also take into accounts that taxation on public charging is subject to twenty per cent VAT, while home charging is just 5 per cent. Experts are lobbying the federal government to scale back the previous in-line with domestic taxation (read more about this further down).
The Electifying.com study used the identical 58kWh-battery VW ID.3 electric hatchback to calculate annual running costs when using only the general public network, though it based its calculation on 48 charges per 12 months to reflect charging from 10 to 80 per cent battery capability (which is the everyday charging session on a public rapid device).
This resulted in a complete charging cost every year of £1,476. Compare this to the pre-October cap increase cost to charge the electrical Volkswagen at home – £634 – and it means a premium of £842 for using public devices.
Theoretically, by adding the present £842 annual public charging premium to the post-cap home charging bill for an ID.3 takes the overall cost per 12 months to £2,007 for those with no charger at home. That is £388 greater than the estimated annual fuel bill for a petroleum Golf.
It implies that unless you will have a driveway or garage with a homecharger installed, an electrical automobile could make less financial sense than a petroleum powered one after 1 October.
Electrifying.com’s report from earlier in August ranked all the most important public providers based on their pay-as-you-go prices at first of the month.
It is vital to notice that most of the providers listed offer a membership or monthly subscription to make use of their networks. While that is an additional cost it might probably work out cheaper over repeat uses as members profit from subsidised rates per kWh.
Public charging providers ranked by current cost
1. Ionity: 69p per kWh
=2. Instavolt 66p per kWh
=2. Osprey: 66p per kWh
4. Shell Recharge Ultra-Rapid 175kW: 65p per kWh
5. ChargePlace Scotland: 60p per kWh
6. Tesla Public: 61p per kWh
7. Shell Recharge Rapid 50kW: 59p per kWh
=8. GeniePoint: 57p per kWh
=8. Swarco EConnect: 57p per kWh
=10. MFG EV Power: 55p per kWh
=10. MER Ultra Rapid 75kW 55p per kWh
12. Fastned: 54p per kWh
=13. Gridserve High Power 350kW: 50p per kWh
=13. Raw Charging 300kW: 50p per kWh
=13. Tesla owner: 50p per kWh
16. MER 50kW: 49p per kWh
17. Gridserve Medium Power 60kW: 48p per kWh
=18. ESB: 45p per kWh
=18. Gridserve Electric Forecourt 350kW: 45p per kWh
=18. Pod Point (non Tesco): 45p per kWh
=18. BP Pulse: 45p per kWh
=18. Raw Charging 150kW: 45p per kWh
23. EB Charging: 44p per kWh
24. Pod Point Tesco/Lidl 50kW: 28p per kWh
UK average pay as you go cost: 53p per kWh
Source: Electrifying.com published 15/08/2022
Note: Electrifying.com has collated all current DC rapid charging prices and ranked providers from the most cost effective to the costliest for pay as you go customers. As some charge point providers have different tariffs for various charging speeds and, in some cases, locations, we have now itemised these based on speed available.
Some operators, reminiscent of Pod Point and Mer, have different pricing based on location. Where possible, Electrifying.com used the best charges. Drivers may have the opportunity to charge at lower prices on these networks. For instance, PodPoint rapid chargers at Tesco locations might be as little as 28p per kWh. Some networks might also offer subscriptions which can lower the fee per kWh.
What EV experts say in regards to the energy price cap hike impact for EV charging costs
Quentin Willson, founding father of the FairCharge campaign
‘The energy price cap is now a national emergency affecting all of us.
‘EV drivers might be hit by increased charging costs wherever they’re charging – be that at home or at a public charger.
‘It’s particularly worrying on the general public charging side – if the fee of charging an EV starts to get near the fee of filling up with petrol, then we are going to lose certainly one of the predominant incentives that has driven tons of of hundreds to make the switch and hundreds of thousands more to think about it.
‘On home charging, the brand new PM should remove green levies from energy bills.
‘These are vital investments which have led to incredible reductions in the prices of renewables, but it surely doesn’t make sense for individuals who use more electricity – where the majority of green levies are paid – to be hit hardest.
‘They ought to be paid for out of general taxation.
‘On public charging, my FairCharge campaign has been leading the push to have VAT on public charging (20 per cent) equalised with the speed for home charging (5 per cent).
‘This modification would not solve the problem completely within the face of such staggering rises in energy prices, but it surely could be a crucial step in ensuring that we’re incentivising EV use and never punishing those that haven’t got driveways and so cannot charge at home.’
Ginny Buckley, founding father of Electrifying
‘While the energy price hike is undoubtedly a blow to electric automobile owners, going electric still makes financial sense in the event you’re charging home, which may cost as little as 2p-a-mile on certain tariffs.
‘The newest Ofgem cap of 52p/kWh implies that drivers who do 10,000 miles annually and charge on an ordinary energy tariff will still save £34 every month on fuel in a Volkswagen ID.3, in comparison with filling up a VW Golf with petrol.
‘At the upper end of the market, those that select the favored Tesla Model Y over a Mercedes GLC300 will still save £113 every month in fuel costs.
‘Nevertheless it’s now more vital than ever to hunt down electricity tariffs which can permit you to charge using lower overnight rates while your automobile is parked.
‘These can boost your savings by an additional £81 per thirty days on a VW ID.3 and you will pay a whopping £116 per thirty days lower than you’d running the petrol Golf.
‘With regards to public charging we have already seen some alarming price hikes and there’ll little doubt be more to come back, meaning that drivers without access to home charging pay as much as £1260 more to run their electric automobile than those using an off-peak home tariff.
‘This is the reason I’m calling for the 20 per cent VAT currently imposed on public chargers to be cut to five per cent, and for energy providers to introduce cheaper off-peak tariffs at public charge points to assist balance the availability grid – without taking these steps, we risk leaving people behind and making a two-tiered nation in the case of electric automobile ownership.’
Rod Dennis, RAC spokesman
‘The impact of the energy price cap increase will definitely be felt by drivers who charge their electric cars at home, with a full charge of a typical family-sized electric SUV [Kia e-Niro with a 64kWh battery] costing 84 per cent more from 1 October than it did under the old cap – £33.80, in comparison with £18.37.
‘Despite recent falls in the value of petrol and diesel, the fee of charging at home remains to be good value in comparison with paying for either fuel, but again underlines just how the rising cost of electricity is affecting so many areas of individuals’s lives.
‘We’re also aware that public chargepoint operators are having no selection but to extend their prices to reflect the rising wholesale costs they’re faced with, which can heavily impact drivers who haven’t any selection apart from to charge up away from home.
‘The RAC continues to support the FairCharge’s campaign call for the Government to chop the VAT rate levied on electricity from public charge points to five per cent, to mirror the speed charged on domestic electricity.’
Emily Seymour, Which? energy & sustainability editor
‘An enormous a part of the electrical vehicle appeal has all the time been lower running costs, but these price rises could jeopardise more people making the switch to electric cars.
‘Many non-hybrid petrol drivers will still lower your expenses by switching to electric, but for a lot of diesel drivers that now won’t be the case.
‘In a recent survey, we found that the upfront cost of shopping for an EV is the largest barrier stopping drivers from considering an electrical vehicle – and this latest energy price rise could further prevent people from making the switch.’
Other electric automobile running cost pros & cons to think about
– For company automobile drivers, electric cars are currently subject to much lower benefit-in-kind taxation. Pure-EVs just like the VW ID.3 are rated at 2 per cent BIK until the top of March 2025 – the equivalent VW Golf is rated at 29 per cent.
Electric vehicles are also eligible for salary sacrifice schemes, which permit employees to drive a completely electric company automobile by forgoing a portion of their salary.
This amount is deducted before tax and National Insurance contributions are applied, much like advantages for childcare, gym membership and cycle-to-work schemes, and make EVs much more financially appealing
– Electric cars owners are exempt from paying annual Vehicle Excise Duty
– Pure EVs are exempt from having to pay to enter emissions charging zones, including the London Ultra-Low Emission Zone and Birmingham’s Clean Air Zone. Additionally they avoid charges for London’s Congestion Charge Zone
– EVs have the next MOT pass rate than petrols and diesels and are generally cheaper to service
– Electric cars are substantially pricier than an equivalent petrol or diesel model. Experts have claimed there might be price parity by 2026, though these predictions are currently looking wide of the mark
– Government grants subsidising the value of sub-£32,000 EVs and the fee of getting a homecharger installed at your property have been discontinued as of 2022
ELECTRIC CAR VIDEOS
Some links in this text could also be affiliate links. For those who click on them we may earn a small commission. That helps us fund This Is Money, and keep it free to make use of. We don’t write articles to advertise products. We don’t allow any industrial relationship to affect our editorial independence.