WWhile the rise in the price of petrol may have made headlines, the energy crisis has also hit the wallets of electric car owners. The cost of charging at home has increased by 43% for some drivers, while the already higher cost of charging on the road has increased by 25%.
As energy prices are driven up by rising costs for suppliers, specialized charging deals for drivers have become scarcer. And now there are suggestions that people may delay purchasing an electric car as the cost of living arises.
While demand for vehicles is high, a new report released this week from Volkswagen Financial Services suggests fewer people would commit to buying electric vehicles (EVs) as belts tighten and energy costs rise.
“The tight cost of living is likely to mean some potential EV buyers won’t switch this year, especially as such vehicles are considered relatively more expensive compared to combustion engine alternatives,” the report said.
Charging at home
Electric car owners who charge their vehicle at home will usually find one of the specialized rates that is the most cost-effective. Two-rate rates offer one price for electricity used during the day and another for nighttime use. When the prices are much lower, you can upgrade your battery cheaply.
For example, comparison site Love My EV lists the rates for EDF’s GoElectric 35 as 44.69p per kilowatt hour (p/kWh) during the day and 4.5p/kWh at night. The Octopus Go fare costs 35.04 p/kWh during the day and 7.5 p/kWh at night. Both figures are based on supplying a home in South Wales.
Since energy prices have risen, the number of specialist deals in the market has fallen, says Laura Thomson, co-founder of Love My EV. While these are usually the best deals for overnight drivers, the daily rate and standing charge can be expensive, which consumers should consider when figuring out what’s best for their situation.
“For most people who have an electric car to charge at home, it makes sense, but there’s a high flat fee and a high daily rate to take into account,” Thomson says. If you use a lot of electricity during the day, this may not be your best option.
The site has a rate comparison tool. Beware of promises of “free miles” within fares, as these savings may be outweighed by higher costs, it says.
The rising price of EV rates means drivers are now paying 43% more than a year ago. This equates to an increase of around £75 a year for an average vehicle such as a Nissan Leaf or a Renault Zoe, says Ben Nelmes of transport research firm New AutoMotive.
In 2021, the cost of charging an electric car traveling 7,400 miles a year – the average mileage – charged mainly at night was £174. This was based on a nightly rate of 4p/kWh and a daily rate of 18p/ kWh. Last month, the same charging method cost £249 a year, based on the best prices available at the time – 5 p/kWh at night and 28 p/kWh during the day.
“Anyone driving a larger EV, such as a Kia e-Niro or Tesla, will find that it underestimates what they are going to pay. Likewise, someone in a Smart car will find themselves spending a little less than this,” says Nelmes.
On the road
Increasing costs are also visible for public chargers. Instavolt, which operates a charging network across the UK, has raised its prices twice so far this year, first from 45 p/kWh to 50 p/kWh and then to 57 p/kWh. Ubitricity, one of London’s largest charging networks, raised prices from 24p/kWh to 32p/kWh last month.
Data company Zap Map, which maps public charging stations, found that charging costs increased on average from 24p/kWh in December to 30p/kWh in February for slow and fast chargers, and from 35p/kWh to 44p/kWh for fast and ultra-fast chargers.
“The price of charging your EV on the public network, or at home, has risen significantly in recent months with the general increase in electricity prices,” said Melanie Shufflebotham of Zap Map.
According to the Volkswagen Financial Service report, there are currently 460,000 EVs in the UK and only 300,000 home charging points installed. Those who don’t have a home charger end up paying more, according to Keith Brown of Paythru, a payment technology company. “One of the major inequalities of the emerging EV charging market is the price drivers of ‘premium’ electric vehicles pay for not having or being unable to have a home charging point,” he says. “The domestic supply is taxed at a VAT rate of 5%, while the supply of public charge points is taxed at a VAT rate of 20%.”
Shufflebotham has called for the rates to be equalized. “Equalizing the VAT rate for both public and home charging would be a good example of raising the level and encouraging more people to switch to electric vehicles,” she says.
Despite rising prices, EV drivers still face much lower bills than petrol or diesel cars, using figures based on the same annual mileage for all types of vehicles.
Nelmes says that while the cost of charging electric cars at home is high, it dwarfs the cost of refueling a car.
“We estimate that the average British motorist would spend £1,028 a year on petrol and £987 a year on diesel. That went up a year ago from £796 a year for petrol and £747 a year for diesel,” he says. “That means the fuel cost savings available to petrol and diesel drivers switching to EVs this year is £779 for petrol drivers and £738 for diesel drivers.”
Case Study: Positives and Negatives
After purchasing a Nissan Leaf in recent weeks, Philip Ingram looks back with some annoyance at the deals available last year.
He currently pays a flat rate of 28.45 p/kWh all day with British Gas, the best rate available to him at home in Bordon, Hampshire. Last year he could have taken advantage of deals as low as 5p/kWh overnight, he says. While there are deals with good nightly rates, their high daytime rates now make them unsuitable for the family budget.
The annoyance is tempered by the savings of switching from a diesel VW Golf to an EV.
Ingram, who runs a cotton company called LittleLeaf Organic, used to pay nearly £90 to fill up with diesel, but gets the same mileage for £20 recharge. This has to be weighed against the cost of the car: £24,000. “I wish we had done it a long time ago,” he says, “but the reason we’ve been slower is…cost of capital. I’ve said several times before: [my wife] Lisa, the running costs are unbelievable, but when you consider the cost of buying this car, [which] is huge.”