The Government’s budget has introduced a new pay-per-mile scheme for electric cars which aims to claw back some of the revenue lost from fuel duty by the increasing number of EVs on the road.

This is inevitably going to put off some people from making the switch as it makes running an electric car more expensive. But how much of a difference will it make to the average motorist, and to you?

Doing the sums is becoming ever more complex, but I’ve fired up the Electrifying spreadsheet to look at the totals.

The boring bits first - there are certain assumptions I’ve made. First, I compared three similar cars – all Volkswagens. For the EV it’s a 58kWh ID.3 with a range of 264 miles – that’s an efficiency of 4.55 miles/kWh. 

The petrol car is a Golf 1.5 TSI consuming fuel at a rate of 49.7 mpg. To really confuse everyone there is also a PHEV in the mix, a Golf GTE using a scenario where it is never plugged in and consumes at 55mpg. At the other end of the usage scale is the same car being used as an EV and never using the petrol engine, which gives it an official efficiency of 3.55miles/kWh.

Fuel is calculated at £1.37/litre and electricity is costed at three different levels:

A standard home tariff with electricity costing 26.35p per kWh – the current Ofgem cap level.

An intelligent overnight tariff, which supplies six hours of electricity at 7p per kWh – that’s easily long enough to charge a car covering these mileages. 

Public pointsat an average of 60p per kWh. While this is lower than many rapid points, the average takes into account that cheaper rates are available at both slower chargers and some rapids from the likes of Tesla and Believ.

The total running cost figures also include the eVED rate of 3p per mile for pure EVs and 1.5p for PHEVs. 

Show me the figures – at 8,000 miles per year

EV better than petrol by up to £640 per year, but can be £292 more if using public chargers.

At the average motorist’s total mileage, the all-electric ID.3’s total running costs including road tax and 8,000 miles of the eVED will be £898 for a year - if you charge during the day on a tariff which is at the current Ofgem rate.

On a Golf 1.5 TSI petrol the cost would be £1,198 per year at an average of 49.7mpg, including the road tax. There is no eVED, obviously.

Use a Golf GTE PHEV and don’t plug in at all, get 55mpg and the cost will be £1,221 – so more expensive than petrol. Plug it in 100% of the time and make the most of the 70 mile range and it drops to £908. 

The real benefit for the EV and PHEV comes if you can use cheap overnight energy. I did the sums using Octopus’ Intelligent Go’s rate of 7p per kWh, which means the overall fuel cost tumbles to £123 per year for the electric car and £158 for the PHEV. Add in the other VED and eVED and the total is £558 per year – less than half the cost of petrol.

At the other end of the scale is someone who has to charge solely in public at an average of 60p per kWh.  Charging here increases the cost to £1,055 for the EV, making a total of £1,490 for the year with the other charges – that’s £52 more than the petrol Golf for fuel alone and £292 more in total with the eVED included. 

Show me the figures – at 12,000 miles

EV better than petrol by up to £959 per year, but can be £438 more expensive if using public chargers.

At a higher mileage you might assume the extra pence per mile of the EV would make it more expensive – but you also get the benefits of the cheaper fuel, as long as you can charge at home. Even without a special tariff you will save £449 per year, but plug into an intelligent overnight deal and you’ll be nearing a four-figure saving.  

As you also might expect, the extra cost of having to charge in public also accelerates the cost as the miles clock up – it now costs £438 more than a petrol car and a ridiculous £1,397 more than charging off peak at home.

For the naughty Golf GTE PHEV owner who never plugs in, the cost will be £1,734 – so £35 more expensive for the year than petrol. Plug it in 100% of the time and it drops to £959 – that’s up to £740 less than the TSI using off peak and £434 lower at the daytime rate. 

Does it still make sense to go electric overall?

Absolutely, and the saving soon add up if you are doing higher miles. Even at the higher tariff and doing 8,000 miles per year, you will save enough to pay off an average charger install within three years. Take the chance the move to an intelligent tariff and the savings are still huge. That’s assuming you’re buying the car too – the incentives for company car and salary sacrifice schemes are still in place and generous.

The only time it looks iffy is if you have to do all of your charging at public points. If the power you are putting into your car costs more than 42.5p per kWh, it won’t make financial sense. 

What about hybrids? Is that the way to go?

Let’s look at PHEVs first. If you charge them at home rather than run them just like a petrol car and they do save versus petrol – but they are not cheaper than the electric car in any of our scenarios.

More interesting is the idea of running a non-plug in hybrid which is more efficient than a pure petrol or mild hybrid. A new Nissan Qashqai e-tech (above) for example has a claimed consumption of 62.8mpg. If that is realistic, the saving by switching to an electric car is just £90 per year at the daytime rate of charging and £430 at overnight tariff rates. 

Which means it still makes sense to go electric with the new eVED charges – but only if you can charge at home, and certainly if you switch to a cheap EV energy tariff.