Major driveway change on Tuesday will affect hundreds of thousands of owners

Electric vehicle (EV) owners who recharge at home are set to gain from a financial boost starting Tuesday, July 1, as the standard price of electricity is to drop with the introduction of the latest energy price cap, decreasing the cost of charging EVs on driveways or in garages at home.

As the new Standard Variable Tariff for electricity dips to 25.73p/kWh on July 1, the 1.5 million UK-based EV drivers will enjoy more economical home charging rates. Many could benefit further from EV-friendly energy tariffs available at around 7p/kWh, making it possible for the average EV motorist to power their vehicle for under £10 each month.

David Watson, CEO at Ohme, which makes home smart chargers for EVs, said: "Charging at home will always be the most affordable place for EV drivers to charge their cars and this lower electricity price is great news to help them reduce their running costs.

"However, any EV driver charging at home should look at switching to one of the wide range of energy tariffs that drop those costs still further to help save them even more money."

The efficiency of charging was spotlighted by Ohme, with the assertion that fully charging a Volkswagen ID. 5 sporting a 77kWh battery to full using their Ohme intelligent charger on a dynamic tariff such as Intelligent Octopus Go would only set users back by £5.39 for the 344-mile WLTP range.

This contrasts starkly with the anticipated cost of £19.82 when charged on the upcoming SVT rate from July 1 – more than triple the amount.

Over a year, a typical EV driver clocking up 6,800 miles will shell out £437.41 for a full year of driving, in stark contrast to just £119 on the Intelligent Octopus Go tariff, for example. In comparison, covering the same distance in an average petrol car would set drivers back more than £1,000, given the current fuel prices.

Ofgem announced the upcoming July 1 price reduction in May, citing a fall in wholesale costs as the key reason behind the anticipated decrease.

Looking ahead, industry analyst Cornwall Insight forecasted at the time that following July's drop, Brits could expect a "modest drop" come October and another slight dip by January next year. But these are simply forecasts, with the wholesale market often swayed by the winds of global politics and strains.

Ofgem prescribes the maximum charge for households on standard variable tariffs through its energy price cap – this being the tariff customers end up on if they haven't switched to a cheaper option.

Ofgem has reminded consumers they're not bound to the price cap, urging them to hunt for more competitive offers. A 7% drop in July may provide some relief to consumers, effectively negating the 6.4% hike that was in effect from April 1 until June's end under the previous price cap.

Prices, however, loom a staggering 65% – nearly £700 – above those in winter 2020/21, and remain a third higher – about £450 – compared to pre-invasion figures from Ukraine.

In comparison to the first Covid-19 lockdown, when the price cap was at £1,179, the new rates for July are still a significant 46% – or £541 – higher.

Uswitch energy expert Ben Gallizzi said on Monday: "Customers who don't have a smart meter should submit their readings before or on Tuesday 1 July, so their supplier has an updated – and accurate – view of their account."

He also warned about the current climate, saying: "There's a lot of uncertainty about global energy costs at the moment, which has led industry experts to predict a rise in energy bills and in the price cap this autumn."

However, he offered a glimmer of hope for consumers: "But households can get ahead of this possible price hike by fixing at cheaper rates now. Currently, there are a range of fixed deals currently available that are around £145 cheaper than the July price cap for the average household."

Mr Gallizzi advised timely action for bill-payers: "If you can switch to a deal cheaper than the July price cap, now is a good time to make the change. We urge customers to run an energy comparison as soon as possible."