Preventing the path of progress for electric vehicle adoption

By David Savage, vice president, UK and Ireland, Geotab. At the United Nations COP27 conference in Sharm El Sheikh, world leaders reaffirmed their calls for urgent action on controlling climate change. Just one day prior to the conference’s conclusion, however, the United Kingdom’s Chancellor of the Exchequer, Jeremy Hunt, announced a further inhibitor to disincentivise the increased adoption of Electric Vehicles (EVs).

It was announced that the UK will be introducing Vehicle Excise Duty (VED), commonly dubbed ‘road tax’, to electric cars, vans and motorcycles. While, in recent years, VED has been targeted to incentivise the use of vehicles that are more environmentally friendly and have reduced tailpipe emissions, from 2025 they will be subject to the same standard rates as their petrol and diesel-powered counterparts.

We’re just eight years out from the planned cessation of Internal Combustion Engine (ICE) based cars in the UK. Combined with the gradual reduction and eventual termination of the Plug-In Car Grant (PICG) earlier this year—not to mention soaring electricity rates both at public chargers and at home—it’s certainly a puzzling decision for the government to make.

We recently launched a report finding that nearly 60% of analysed European light-duty fleet vehicles could switch to electric today, and save nearly £218 million in the process. At the time, however, we found that despite having the highest share of EVs with high-range capability, the UK is outpaced by Continental Europe when considering overall cost-effectiveness.

Now with the addition of VED for electric cars, the economic viability of transitioning to electric may be hindered even further. We should be advancing confidently into a new zero-emission, carbon-neutral world. Not regressing back to one built on fossil fuels and internal combustion.