Spring Budget and EVs
Updated: Aug 13
Ahead of the Chancellor's Spring Budget on the 15th of March, FairCharge has sent our representations to the Treasury outlining five key recommendations needed to unlock the full potential of the UK’s EV industry and support drivers of all incomes to make the switch.
If you agree, please write to your MP at: https://fairchargewritetoyourmp.co.uk/.
We call on the Government to:
1. #AxethePavementTax and equalise the VAT rate for public charging (20%) in line with off-street (5%) charging.
This outdated VAT policy punishes the 38% of UK households without access to private parking and acts as a barrier to EV driving for low-income drivers. While the Government’s Energy Bill Relief scheme has provided a welcome reprieve to charge point operators to alleviate rising costs, with support ending in April, we face the very real possibility that driving an electric vehicle on the public charging network will become more expensive than fuelling a petrol or diesel car.
2. Deliver a strong ZEV mandate and charging infrastructure.
Last year, the Government consulted on the proposed ZEV mandate, a mechanism designed to place targets on car manufacturers to sell a certain proportion of electric vehicles annually in the run up to 2030. Not only would the ZEV mandate be essential to providing investment confidence in the domestic EV supply chain, ensuring that the UK retains its vital car industry and ultimately bringing purchase costs down for consumers, but it will also provide investment certainty for the charge point sector. There is also a need for the Government to work closely with local authorities to enable the delivery of EV infrastructure plans, which simply won’t materialise without increased guidance, resources and direction.
3. Supporting EV access schemes for low-income drivers.
While demand for EVs has increased to record levels, the current upfront cost of buying or leasing even a second-hand EV is pricing many out of low-emission driving. This is exacerbated by high interest rates for financing options and the rising cost of public charging. France and the US have already taken measures to support EV uptake among low-income drivers and the UK should look at these international examples and adopt similar measures, otherwise it risks falling behind in the EV race.
4. EV specific road signage.
Currently, EV drivers can navigate the public charging network through a multitude of online apps and information sets, but there is no signage yet on motorways, service stations and major A roads to point to available charge points. This not only poses an issue for existing EV drivers, as without internet access charge points cannot be easily located, but it also prevents would-be EV drivers from understanding the scale of how far the transition has progressed. Signage indicating the number of rapid chargers, providers and the cost of EV charging would help increase public confidence and improve the user experience of EV drivers less comfortable relying on apps and internet connection.
5. Decoupling wholesale electricity prices from gas.
Despite gas being used last in energy production, it is the main cause of inflated electricity prices. Government should take immediate steps to reduce our reliance on gas for the sake of energy security and affordability, as the benefits of decoupling go far beyond EVs and would lower energy costs, reduce inflation, interest rates, and improve GDP for all.
We urge the Treasury to implement our simple recommendations in the next Budget to ensure Britain remains on course to meet its climate targets, boost domestic energy security, and bring cleaner air to our urban centres.