Switched On Pay-Per-Mile Comes to UK EVs: Analyst Reaction
Dec 23, 2025
Madeleine Brolly, an EV charging analyst at BloombergNEF, and Shananthan Kalaichelvan, who specializes in EV policy impacts, dive into the UK's mixed signals for electric vehicle economics. With purchase subsidies tripling, they discuss the upcoming pay-per-mile scheme aimed at recouping fuel tax losses. Key topics include the challenges for users without home charging, the impact of fluctuating public charging costs, and how these changes could affect high-mileage drivers. Together, they illuminate the balance between incentives for purchase and taxing usage in the evolving EV landscape.
AI Snips
Chapters
Transcript
Episode notes
Subsidy Paired With Mileage Charge
- The UK paired a big upfront EV purchase subsidy with a new pay-per-mile charge to recoup lost fuel duty revenue.
- The subsidy accelerates adoption while the mileage charge shifts running-costs onto drivers as fleet electrifies.
Mileage Charge Recoups Subsidy Fast
- BNEF estimates the pay-per-mile could recoup much of the £1.9bn subsidy within a year.
- Initial revenue could roughly match the upfront grant pot quickly as EV use scales.
Wide Cost Gap Between Home And Public Charging
- Charging costs vary widely by location, from ~2p/mile (smart off-peak home) to ~23p/mile (fast public).
- Adding a mileage tax hurts publicly charging drivers far more than home chargers.