How will pay-per-mile impact the cost of running an electric car? From April 2028 an additional road tax based on mileage will be introduced for electric and hybrid vehicles. This new tax (called eVED) is designed to counteract falling revenues from petrol and diesel fuel duty as people switch to electric cars. It is not designed to make electric cars more expensive to run than petrol/diesel cars – in fact EVs will still offer substantial savings.
At the moment, if you are paying less than 45p/kWh for your electricity, your electric car will be cheaper to fuel than a petrol car. Even with the eVED of 3p per mile, your electric car will be cheaper to fuel than petrol if you are paying less than 33p/kWh. At home the energy cap is less than this breakeven point at 26.35p/kWh. If you are using off-peak or EV tariffs, your electricity is likely to be priced between 7p and 10p/kWh, making significant potential savings. Even if you do not have an off-peak tariff but are charging at home, it will still be cheaper than running a petrol car particularly when you add in reduced costs of servicing and maintenance. If you are thinking of switching from a diesel car, your electricity needs to cost less than 39p/kWh or 27p/kWh with eVED. These figures assume petrol/diesel at today’s prices. The Chancellor announced in her budget that fuel duty will increase by 5p/litre between September 2026 and March 2027. This will make running an electric car even cheaper.
After the introduction of eVED, it will not be as obvious to make the switch if you are not able to charge at home. All industry bodies are campaigning the government to improve pricing for those using the public charging network. More competition for these chargepoints should also start to drive down pricing.
We have used the ZapMap fuel cost calculator comparing Peugeot 208s using electric, petrol and diesel for this article with pricing correct as at 13 November 2025.
Even with eVED, an electric car is the smart choice over cars using fossil fuels. Why? Fuelling is likely to be cheaper, maintenance and servicing is less, their impact on the environment is smaller, in the secondhand market they cost the same and the driving experience is superb, fun and easy. Come and test drive with us today!