November 2025 Budget: What's Changed for EV Drivers

The November 2025 Budget for EV drivers contained more than the usual fiscal updates. By stripping roughly £150 of legacy green levies out of household electricity bills from April 2026, the Chancellor cleared the way for a sharp drop in off-peak EV tariffs — the cheapest of which has already been announced at 5.49p/kWh, a 39% cut on the rate most overnight chargers were paying through 2025.

This guide pulls together every change that matters for drivers running an EV at home: the levy removal, the new off-peak rates, the reformed Electric Car Grant, the unchanged-but-now-active VED rules, and the hard dates for each. If you charge overnight, lease an EV, or are budgeting for one in 2026, the numbers in this post are the ones you'll be quoted by your supplier in April.

The headline measure for energy users in the Autumn Budget 2025 (delivered 26 November 2025) was the removal of around £150 a year in legacy green levies from a typical household electricity bill. According to HM Treasury, the change is delivered by the government covering 75% of the legacy Renewables Obligation cost between 2026 and 2029, alongside reform of the Energy Company Obligation funding model so it no longer sits on bill-payers.

This matters disproportionately to EV drivers for one reason: the levies are charged per unit of electricity. The more kWh you import, the more you've been paying in policy costs. A typical household uses 2,700 kWh/year. A household running a single EV — say 8,000 miles at 3.5 mi/kWh — adds roughly 2,300 kWh on top, almost doubling consumption. So the levy reduction translates into something closer to a £270 annual saving for an EV-charging household than the £150 figure quoted for the average bill.

The reduction shows up in two places. First, in your standard unit rate (the day rate), since suppliers are now passing through a smaller policy-cost line. Second — and this is the bigger story — in the off-peak rates that EV-specific tariffs charge, because suppliers have a thinner cost base to sit beneath an already-aggressive overnight price.

Within days of the Budget, Octopus Energy confirmed that Intelligent Octopus Go — the UK's most popular smart-EV tariff — would drop its off-peak rate from 9p/kWh to 5.49p/kWh from 1 April 2026. That's a 39% reduction, and it makes overnight EV charging the cheapest energy commodity available to UK consumers.

For context, here is what 5.49p/kWh actually means in real numbers:

Octopus is unlikely to be alone. The other main EV tariffs — EDF GoElectric, OVO Charge Anytime, British Gas EV Power, and E.ON Next Drive — sit on the same wholesale market and the same underlying levy structure. Most are expected to follow with comparable cuts in Q1 2026, though the timing and exact figures will vary by supplier.

If you're already on a smart EV tariff, you don't need to do anything — your supplier will adjust your unit rate automatically when the levy changes take effect. If you're still on a single-rate tariff and charging at home, the saving from switching is now larger than at any point since EV-specific tariffs launched. Our best EV tariffs 2026 comparison walks through the cheapest options.

The Budget also confirmed the continued operation of the Electric Car Grant (ECG), the replacement for the Plug-in Car Grant that was withdrawn in 2022. The ECG offers a discount of between £1,500 and £3,750 toward the cost of an eligible new EV under £37,000.

The award is tiered by manufacturer sustainability rating — vehicles built using lower-carbon supply chains receive the higher amount. Buyers don't apply directly: the grant is administered by the Department for Transport's Office for Zero Emission Vehicles (OZEV) and is deducted from the price by the dealer at point of sale.

For drivers comparing finance offers, the grant effectively acts as a deposit reduction on PCP and HP deals, which is where most EVs are bought in the UK. It does not apply to used vehicles, leases that are structured purely as long-term rentals, or vehicles over £37,000.

Vehicle Excise Duty (road tax) for electric vehicles came into effect from 1 April 2025, ending the long-standing exemption. The November 2025 Budget did not change these rates, but it's worth restating what they are, because many drivers buying their first EV in 2026 won't yet have encountered them:

For most owners, the practical effect is £195/year. For drivers of premium EVs (which is where most of the over-£40k models cluster), the Expensive Car Supplement adds £2,125 across five years on top — a meaningful figure that people often miss when modelling total cost of ownership.

Putting the changes together, here's how the maths shifts for a fairly typical EV driver — 10,000 miles a year, charging mostly overnight on a smart tariff, registered 2024:

That's a £100/year reduction directly attributable to the November 2025 Budget changes — and it scales with mileage. A 20,000-mile-a-year driver sees roughly £200/year. The savings compound on top of the cost gap to petrol, which a worked-out home-charging cost calculation still puts at around £1,000/year for the average driver.

One nuance worth flagging: the levy removal applies to all electricity consumption, not just off-peak. So even drivers without a smart tariff — perhaps because they don't have a fixed home or off-street parking — see some benefit, just a smaller one. The biggest gains go to drivers with a smart EV tariff who can shift the bulk of their charging to overnight hours.