Major energy supplier Octopus Energy is adjusting the terms of its popular electric vehicle (EV) charging tariffs in the wake of the government's new pay-per-mile road tax announcement.
Changes to Octopus EV Tariffs
From January, the company will automate its Octopus Intelligent Go tariff, which controls when an electric car charges to access the cheapest rates. While the provider confirmed the actual energy rates will not increase, the window for discounted charging will be capped at six hours per day.
This tariff is distinct from the standard Octopus Go offer, which provides five hours of cheap energy overnight. The automation move is designed to optimise charging within the new, more restricted cheap-rate window.
The Chancellor's New EV Tax Levy
The tariff adjustment comes after Chancellor Rachel Reeves used the Autumn Budget to unveil a new road tax for electric and hybrid vehicles. The policy, set to begin in April 2028, aims to recoup revenue lost from declining fuel duty as drivers switch from petrol and diesel.
Under the new rules, pure electric vehicle (EV) drivers will be charged 3p per mile, while hybrid motorists will face a 1.5p per mile levy. This would add a significant cost to long journeys; for example, a trip from London to Edinburgh could incur an extra £12 in tax.
Industry Reaction and Rebates
The announcement has already prompted a response from parts of the automotive industry. Two Chinese car brands, Omoda and Jaecoo, are fighting back by introducing an EV tax rebate on their new E5 models.
The rebate will cover the equivalent of 20,000 miles at the 3p per mile rate. Gary Lan, CEO of Omoda and Jaecoo UK, stated the initiative "effectively covers the first few years of this new tax," offering drivers "thousands of miles of zero-cost motoring" and demonstrating a commitment to accessible electric mobility.
The combined effect of the new per-mile tax and changes to energy tariffs marks a shifting financial landscape for UK electric vehicle owners, moving costs closer to those traditionally associated with fossil-fuel vehicles.
