The Resolution Foundation is calling for electric vehicle (EV) owners to pay higher electricity bills when charging their cars during peak evening hours. The think tank argues that this pricing structure would encourage drivers to charge their vehicles overnight instead, reducing the strain on the energy grid.
Currently, electricity costs remain the same regardless of the time of day, despite delivery costs being significantly higher during peak hours (4:30 pm to 8 pm). As EV adoption grows, the surge in evening charging is expected to lead to a substantial spike in delivery costs, potentially inflating bills for all consumers.
To address this issue, the Foundation recommends introducing variable prices for EV owners who exceed a certain usage limit. This would mean higher prices for evening charging and lower rates for off-peak usage. According to Zachary Leather, author of the report, “We’re transitioning to a different kind of energy system, one where we need demand to respond a bit more to the supply [of energy].”
The proposed changes aim to promote more flexible energy usage. EV owners who charge during off-peak hours could save an estimated £120 annually. Moreover, shifting to off-peak charging could lower average energy bills for the entire country.
This proposal is part of a broader review of the electricity market, which also includes the potential introduction of ‘zonal’ pricing. This system, used in countries like Australia and Sweden, would divide Britain’s energy market into regions with prices based on local supply and demand. While this could lead to average savings of £200 per year for households, it may also result in higher bills for areas with high demand, such as the South of England.
Ed Miliband, the Energy Secretary, is considering the adoption of zonal pricing as part of the Review of Electricity Market Arrangements. The government is working to create a more flexible energy system to achieve its goal of delivering clean power by 2030. Currently, off-peak tariffs already offer EV owners savings of around 75% when charging overnight.
