My Urban Car

Fuel versus EV charging cost survey

In our survey we’ve looked at how the cost of filling up with petrol and diesel compares with charging electric cars in the UK. Then we’ve looked at how that has changed compared to a year ago and why largely renewable UK electricity has gone up in price faster than petrol.
(currently updated with fuel prices as at 9th June and Charging costs at 19th June 2022)

There is a general assumption that Electric cars are more expensive to buy but charging is always going to be much cheaper than filling up with petrol and diesel. So how is that shaping up in 2022 when both fuel and electricity prices have soared thanks to a spike in oil and gas demand following the pandemic and the Russian invasion of Ukraine.

Well it turns out UK public charging costs are much rising faster than fuel for combustion cars despite the fact that on average only 35-40% of UK electricity is actually generated from oil and gas. It turns out the UK has a scandalously flawed way of deciding how to price electricity that is based almost entirely on the price of gas is hitting EV drivers hard. We’ll explain why.

1 How we compare the costs – Petrol v Diesel v Electric

It’s quite hard to compare the cost of a liquid fuel burnt inside a piston engine with electricity running electric motors so we’ve made it super easy. We’ve done the maths and you just compare the cost in pounds to drive 1,000 miles.

We’ve also split the results into green for the most economical cars, yellow for average and red for the least uneconomical. Just like for piston cars, some electric cars are very heavy and inefficient so they don’t travel as far as many miles per kW/h as more efficient cars. Just look at the actual economy of your piston or electric car to compare costs.

Charging prices vary a lot, so we’ve also picked a few price points that most UK charging networks are close to, for quick DC 50-350kW charging that usually takes between 18 and 40 minutes. We’ve also added some very poor and very good value slow AC chargers.

If you don’t like comparing per thousand miles just move the decimal point to the left to get the price per 100 miles.(so £150 per 1,000 miles is £15 per 100 miles. If you want to try your own mpg or different prices per litre there is a handy calculator at  Fuel Economy UK 

Click to enlarge

2 Cost comparison results – what do they tell us?

  • Firstly looking only at costs right now, whatever car you drive it’s how efficient it is that makes the biggest difference to what you pay. If you drive a petrol or diesel in the green column averaging 50mpg or more then congratulations. For every 1,000 miles you are saving about £120 compared to a petrol or diesel driver in the red column with 30 mpg.
  • By comparison the savings you get switching to an electric car right now aren’t that great when public charging. If we take the Instavolt charging price as typical right now, switching from a yellow column petrol to electric will save you just over £46 per 1,000 miles. Switching from a yellow column 40mpg diesel will save a little more, around £55
  • Want to save fuel cost without changing cars?
    Well all cars are least efficient on short urban journeys when walking, cycling or public transport might be easier.
    Not running your engine when parked up would also cut your fuel bills easily and cut pollution too
    Finally driving more efficiently, accelerating less hard and coming off the accelerator early when you are heading to a stationary queue or red traffic light will mean you get much further with each litre or kWh you purchase. It will also save money on brake pads.
  • Tesla– As a reference point the very efficient Tesla Model 3 and Y electric cars will probably deliver an average of 3.5 miles per kW/h over the whole year so between the green and yellow columns. At the Instavolt price that means £160 for 1,000 miles and, although they vary, some Tesla’s Superchargers still cost less than 49p per kWh.. a few are half as much. Likewise some other car brands get big discounts charging at Ionity
  • It’s worth bearing in mind when you’re not DC charging some slow AC chargers are sometimes much cheaper or even free.. in a yellow column electric car charging on a home overnight 7.5p off peak tariff you might be able to cover 1,000 mile for just £22.50! Likewise some on street chargers like the 32p Shell Ubitricity lamp posts would be just £96.00 per 1,000 miles, only a little more than peak time charging on a home charger.
  • The good news is Source London are no longer the UK’s most expensive chargers, having reduced their pay as you go prices for slow AC charging from 70p to 59p per kWh. The lesson here is Electric car owners will sometimes pay nearly as much as petrol or diesel drivers, but many also have the chance to charge at 10x less. If they have their own solar panels charging might even be free. So while petrol and diesel prices pay similar prices all the time the average electric car drivers pay from different sources will be lower over a year.

3 What’s happened to fuel v charging cost in the last 12 months?

Well it turns out charging costs for electric cars have been rising much faster than the prices for petrol or diesel.

Petrol and diesel fuel prices in the fluctuate. During the pandemic they fell to around 117p per litre but assuming more normal prices they went from

  • From 127p to 190.81p – 50.02% rise for petrol
  • From 130p to 198.58p – 52.9% rise for Diesel .

For charging let’s look at an Autocar review of various charging companies in their article 20th January 2021

  • Ionity was 69p per kWh now 69p – Unchanged (was extortionate, still is)
  • BP Pulse was 30p for a 50kW charger – now 56p an 86% rise
  • Instavolt – was 35p – now 57p per kWh a 62% rise
  • Ecotricity – was 30p now Gridserve 48p (medium speed) a 60% rise
  • Geniepoint – was 30p now 57p a 90% rise
  • Osprey – not mentioned but from memory was 36p now 66p an 83% rise
  • Podpoint at Lidl – was 23p now 25p an 8.6% rise
  • Home charging – off peak was 5p now 7.5p a 50% rise while peak is up from 15p to 30p a 100% rise

As you can see it’s not just petrol and diesel drivers that should be clamouring for relief from soaring prices, in fact charging costs are rising much faster than fuel. Remove the bookends ( Ionity and (customer only or £100 parking fine Lidl) and you’re left with a 76.2% average rise in the cost of UK electric car charging since Jan 2021!

Sadly this shows no sign of letting up, with Osprey being the latest network to leapfrog to higher prices, from 49p per kWh to 66p! We estimate that on current petrol prices parity will be reached in the green and yellow columns at 73p per kWh. Unlike for petrol and diesel there is no sign the increases in public charging prices have peaked. Parity with all but the least economical petrol cars looks close to being reached.

On the plus side Source London, which used to provide the most expensive charging in the country at 70p per kWh has at last cut its prices for pay as you go to 59p. It appears they have also removed the supplement for charging in central London boroughs.

4 Why are UK charging costs rising so much faster than petrol and diesel? Is it the Government or the Russians or the French?

Petrol and diesel

Well we’re comparing 2 things so starting with the price of petrol and diesel. Why hasn’t it gone up more? In a word it’s fuel duty which for years has been fixed at 57.95p for both fuels. By contrast the cost of the fuel and biofuel contributes only about 67p to the cost of a litre of petrol at the end of May 2022. Then there is delivery, retailer margin and VAT. Essentially only about 40% the price of petrol goes up directly with refined oil prices. Remember that 40%

How UK electricity prices are set

So what about electricity? Well electricity is also 60% produced from sources like wind, solar, nuclear and biofuel that haven’t changed in price. Just under 40% comes from gas which has gone up massively in price recently. So why has the cost of UK electricity gone up so much (which is feeding into much higher EV charging prices)

Well for this lets look at the words of the Chancellor during his 26th May 2022 “windfall tax” statement.

Certain parts of the electricity generation sector are also making extraordinary profits. The reason for this is the way our market works. The price electricity generators are paid is linked not to the cost they incur in providing that electricity but rather to the price of natural gas, which is extraordinarily high right now. Other countries like France, Italy, Spain and Greece have already taken measures to correct this”

Chancellor Rishi Sunak during his 26th May 2022 “windfall tax” statement.

So to sum up, the former Chancellor is admitting that the reason UK electricity prices have gone up so much is because it is being pegged to gas prices. In fact the way the market operates is even stranger. Generators bid to provide power for half hour periods. Wind and solar might be 4p per kWh, Nuclear 13p but during peak times gas is needed as well. If the gas bid is for example 30p then every generator (including wind, solar and nuclear) all get paid the price offered by the worst or highest bidder, in this case 30p even if they bid just 4p!

The government is currently “consulting” to change the system but unlike France, Spain Italy and Greece appears not to be in any rush. Instead the government appears to have decided to let generators make windfall profits and then use taxpayers money to compensate some electricity users for the the obscene electricity bills this flawed market delivers.

The French

So the cost of gas crisis has paradoxically hit electricity prices hardest. There is one other curious factor at play and it’s the French!
Nothing sinister.. France produces most of it’s electricity from nuclear power and often send surplus power to the UK via undersea cables known as interconnectors.

Unfortunately with abysmal timing in 2022 half of all the Nuclear power plants in France have had to be taken offline for a combination of regular maintenance and emergency repairs. As a result instead of the UK grid being topped by French electricity UK generators are having to burn extra gas to keep the French grid up and running. Quite proper but it means we are burning extra gas in UK and are likely to have much longer periods needing gas plants operating at peak demand mode.

5 VAT on charging

Wholesale price is is the main thing driving electric charging prices skyward. The other is that the Inland Revenue prevailed in a dispute over whether the VAT on public charging bills should be levied at 5% or 20%. As a result charging companies have to add 4x as much value added tax than is paid by someone charging at home.

6 Conclusion

Neither of these Government created issues are within the control of charging networks. The good news is when one or both are fixed, charging costs should begin to fall from current peaks, even if oil and gas prices remain high.

Essentially the UK government’s fuel duty stabilises the cost of petrol and diesel, while the same Government’s tax system and completely dysfunctional market for setting wholesale electricity prices, seems designed to destabilise electricity prices.

The government really needs to focus on this issue. On the path to net zero, it makes no sense to artificially inflate the cost of low carbon electricity, making electric cars and heat pumps more expensive than they should be relative to fossil fuel cars and gas heating and cooking. In some cases drivers of plugin hybrids may even decide it’s cheaper to just burn petrol than to charge their batteries.

One of the benefits of clean renewable energy today is cheap and stable pricing. It’s important consumers of energy are able to appreciate that a small and shrinking proportion of our energy comes at highly volatile prices purchased from dodgy dictators. Instead the Government has provided a perverse opportunity for some climate change deniers to falsely claim renewables are driving up household energy bills when the opposite is true.

From a policy perspective many people are suffering from soaring energy costs. Providing relief on the electricity price through market reform not only fits with the long term green agenda, it is also more equitable because almost every household in the land uses electricity, whereas a larger and growing proportion don’t use gas. For UK households it is total energy bills that matter. Whether relief comes from market reform of the electricity market without subsidy, or direct taxpayer subsidy of fossil fuels is immaterial to most consumers but it does matter to our future success in achieving net zero goals.

David Nicholson

David Nicholson Is the founder of Rivergecko Ltd & MyUrbanCar which provide consultancy and advice for drivers and fleets to speed the transition from dirty fossil fuel transport to clean vehicles powered by renewable energy on land water and air.

The @MyUrbanCar twitter feed is a source of news & reviews of electric & plugin cars and vans in the UK.
The @rivergecko twitter feed & www.myurbancar.com websites bring news and opinion on cleantech transport including cars, vans, buses, trucks, shipping, rail & aviation as well as autonomous vehicles & renewable energy, air pollution & motor industry news.

David Nicholson has worked as an underwriter at Lloyd's of London since the 1980's. His interest in technology goes back many years including interactive mapping, apps, green tech, boats, solar and cars.

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