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Electric Rationing & Higher Electric Costs: The Price of Forthcoming Electric Vehicle Charger Regulation 

  • From June 30th 2022, all newly fitted domestic and workplace electric vehicle (EV) charge points must have smart functionality that can control recharge times and potentially can create dedicated EV tariffs

In the push to go electric new regulation has the capacity to ration recharging and to develop a charging mechanism that could form part of a move by the Government to recoup some of the £37Bn of revenue earned by fossil fuel taxes that can expected to be lost.

On June 30th, The Electric Vehicles (Smart Charge Points) Regulations 2021 come into force, affecting all EV domestic and workplace chargers fitted after that date across the UK. The legislation will enable EV charger usage to be billed at higher electricity prices than domestic electricity by operating with a dedicated smart meter. Additionally, it will allow for the potential of ‘electricity rationing’ by deciding when EVs can be charged, helping to avoid overloading the National Grid at peak times as EV utilisation increases.

While the new regulations signal that electric rationing and separate pricing could apply to EV chargers at homes and workplaces, it does not necessarily mean they will happen immediately. However, it does signal the potential for evolution in the transition to a Net Zero environment.

Assessing the impact, MotoNovo Finance’s Commercial Director Debbie McKay observes;

“The crucial journey to Net Zero upon which the UK has embarked has implications for how we live and work. As we transition away from carbon-based fuels, a rapid switch to EVs will inevitably place strain on the National Grid, which in October talked of ‘tight’ supply levels at peak times. The new regulation is designed to address this risk by providing the capability to encourage recharging at low peak times when costs might also be lower. The challenge is that rapidly escalating utility prices have severely limited the availability of such tariffs.”

The potential for higher cost EV home chargers tariffs is sure to be another concern for consumers reeling under record utility price hikes. In the short term, the Government may consider that the timing for dedicated EV charging is uncomfortable, having cut fuel duty by five pence per litre recently in a bid to ease the impacts of the increasing cost of living. However, the stark reality is that the move from fossil-fuel vehicles, which raised £37Bn for the Exchequer in fuel duty and vehicle excise duty (VED) revenues has to be replaced somehow as EV popularity increases.

As Debbie concludes;

“One of the crucial appeals of an EV is lower running costs. On fuel costs alone, someone travelling 30 miles to work and back could save £11 a day or £1980 based on 180 days of commuting by switching from diesel to an EV. The challenge will be how much of this saving would people be prepared to sacrifice to reduce carbon dioxide emissions and support other vital areas of tax spending. Perhaps, even more importantly, will be when we might be prepared to embrace such a change in light of current inflation.”  

EV v Diesel cost comparison – completed 20-04-22

Compared a Tesla Model 3 v Volvo XC60 diesel excluded vehicle excise duty and any clear air zone savings.


Aldermore Group

The Group consists of two operating companies, Aldermore Bank plc and MotoNovo Finance Limited.  Aldermore Bank provides finance to business owners, homeowners and landlords, and supports savers.  It operates exclusively online, by phone and through networks. MotoNovo Finance helps people buy their next car, van or motorcycle.

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