Prime Minister Andy Burnham's new rules are handing 2p per mile charges to drivers both with and without driveways, with two October changes opening up cheaper electric vehicle charging.
The VAT cut on electricity, which took effect from October 1, could drive the cost of charging an electric car on a driveway down to as little as 2p per mile, or in some cases even lower depending on the tariff and expected mileage range. In July, Burnham announced that VAT on electricity, currently set at 5%, would be removed from bills from October in a bid to tackle the cost of living crisis.
Cross-pavement charger rule change
Just weeks later, from October 21, the Department for Transport announced a new rule allowing drivers without driveways to access those cheap charging rates too. Drivers will no longer need planning permission to install cross-pavement chargers which run under pavements from homes to cars, the DfT said.
In its announcement, the DfT said: "This will save drivers up to £300 on installation and open up home charging for as little as 2p per mile. This is all part of the government's bid to deliver 'everyday fixes' that help people with the cost of living."
The DfT added: "Cross-pavement charging means residents without off-street parking can plug into cheaper domestic electricity prices, helping them access savings of up to £1,750 on running costs. By slashing unnecessary red tape for these home chargers, the government is speeding up installations, putting money back in drivers' pockets and revving up the transition to electric."
VAT cut applies to fixed tariffs
It means that drivers both with and without driveways can access these 2p per mile charges on average thanks to the rule changes. Burnham announced that the VAT cut will automatically apply to tariffs which are already fixed, not just for households on the standard price cap or those taking new deals.
VAT on domestic electricity will be cut from 5% to 0% from October 1 for six months, which was Burnham's first significant policy announcement as Prime Minister in July.
Industry reaction to charging disparity
EV lobby groups have long warned that the difference between home charging costs and relying on public charging points risks reducing the switch to electric motoring among lower income households. Tanya Sinclair, chief executive of Electric Vehicles UK, told the Press Association: "Millions of drivers without off-street parking have no choice but to pay 20% VAT when charging in public, while those with a driveway will now pay none at all. If this Labour Government is serious about a fair transition, it cannot ask EV drivers to pay different prices for the same electricity simply because of where they live."
RAC head of policy Simon Williams urged the government to extend the VAT cut to public charging points as well, so that those who cannot use a driveway charger or a cross-pavement charger can still access cheaper rates. He said earlier this year: "We urge the new Prime Minister to give serious consideration to lowering VAT on public EV charging, so that those without driveways can make the switch to electric motoring more affordably."
Dickson Abegunde, Director of Strategic Partnerships at Zoopla, said: "For buyers considering an electric vehicle, access to charging can be an important factor when choosing a home. Zoopla was proud to be the first property website to help buyers discover nearby on-street chargers and search for homes with EV charging facilities. The government's decision to remove planning permission requirements for qualifying cross pavement charging solutions is another welcome step towards making EV ownership more accessible, particularly for households without off-street parking."
