The Energy Price Cap is up 13%, and EVs Just Got More Competitive

Ofgem confirmed today that the default-tariff price cap will rise to about £1,854 a year for a typical dual-fuel household from 1 July, a 13% jumpon the current £1,641. For anyone running an EV at home that's a real cost increase. It is also, against the alternative, a still-comfortable win.

The same wholesale shock that pushed the cap up has been hammering petrol and diesel pumps since late February. The US/Israel escalation with Iran closed the Strait of Hormuz - the route for roughly 20% of global oil and gas - and Brent crude punched back above $100 a barrel. The energy cap reflects that with a quarter's lag; the forecourt felt it within days.

The two shocks, side by side

Between 28 February and mid-May, UK pump prices rose 18.7% (petrol) and 32.0% (diesel). Over the same window the published Ofgem cap actually fell, because Q2 2026 was set before the Iran spike worked through. July is the first cap reading that prices in the shock: +13%. Forecasters expect October to stay near the same level.

Pump prices moved twice as far, in percentage terms, as the cap will. In absolute terms the gap is even wider, because a litre of fuel is a much bigger purchase than a kilowatt-hour of electricity.

What this means per mile

A typical UK EV does about 3.5 miles per kilowatt-hour. A typical petrol car does about 45 mpg. At today's prices the difference is stark:

Charging at home on the new cap, an EV still costs around half of petrol per mile. The cap rise narrows the gap a little; it does not close it.

The off-peak escape hatch

The single most useful thing to know about the cap is that it doesn't cover smart EV tariffs. Octopus Go, Intelligent Octopus, EDF GoElectric and similar are priced against the wholesale market separately and offer 4-5 hours of cheap overnight electricity, typically around 7p per kilowatt-hour. At that rate an EV runs at about 2p per mile- roughly an eighth of what a 45 mpg petrol car costs you. That arithmetic is unaffected by today's announcement.

If you have off-street parking and haven't moved to a smart EV tariff yet, the July cap is the cue to do it. The annual saving for a 7,400-mile-a-year household is in the four figures.

What if you can't charge at home?

Headlines like to compare petrol to 79p/kWh ultra-rapid charging - the Zapmap weighted average for 50kW+ networks - and conclude that EVs only make sense with a driveway.

That maths assumes you put 100% of your miles through a rapid charger, which almost nobody actually does. Rapids are for road trips. Day-to-day, most non-home charging is slower AC at supermarkets, lampposts and workplaces, typically in the30-50p/kWh band.

Drag the sliders below to model a realistic mix. Even with zero home charging, a mostly-destination-AC pattern with occasional rapid stops lands roughly level with petrol on the new cap, and that's before any of the other EV running-cost wins (no road tax to 2028, lower maintenance, no congestion charge, salary sacrifice for company drivers).

Where it really does hurt is the all-rapid extreme - a high-mileage driver with no home or workplace charging at all. That driver was already poorly served by EV running costs; today's cap rise doesn't change which side of the line they sit on.

The takeaway

The 13% cap rise is a real hit if you live on the cap. But the same geopolitical shock has pushed petrol and diesel further, faster. For home-charging EV drivers the cost gap to ICE actually widens slightly after 1 July. For off-peak smart-tariff drivers, almost nothing changes at all.

Compare any EV on sale today against the petrol or diesel car you'd otherwise buy, or run the numbers for your own mileage in the EV Savings Calculator. We currently track 174 verified EVs across the UK market.