Energy crisis shows need for accurate EV charging reimbursement, says Mina
The current energy crisis shows that an accurate solution is needed to ensure EV drivers are not out of pocket, according to EV charging payment specialist Mina.
With nine energy suppliers having gone bust in recent weeks as wholesale energy prices have rocketed, consumers face higher electricity prices – impacting drivers who charge fleet vehicles at home and aren’t on fixed rates.
Just six months ago the average electricity price was roughly 14.2 pence per kWh – it’s now more like 20.4 pence per kWh, according to Mina. And it says to ensure drivers aren’t out of pocket, these increases must be tracked to ensure they’re getting reimbursed correctly.
While many businesses are still using the Government’s Advisory Electric Rate (AER) of 4 pence per mile to reimburse their drivers, the Association of Fleet Professionals and the BVRLA have warned that it’s continuing to leave drivers short-changed and is ‘not fit for purpose’.
A fluctuating AER is not possible either because energy suppliers’ tariff rates differ vastly depending on where you live to the supplier itself. The lowest rate currently in the UK is roughly as low as 10.217 pp kWh (during off-peak hours), and the highest tariff is a 25.544 pp kWh – a 250% increase in difference.
Mina also warns that there have also been roughly 369 tariff changes in the UK over the past six months, so unless each rate is being tracked, businesses will be incorrectly reimbursing their drivers for the cost of charging their EVs.
Instead, the only fair way to pay for a driver’s charging is to pay the actual cost, according to Mina, whose solution manages EV charging payments and was awarded the Innovation in Electric Vehicles title at the Fleet World Great British Fleet Awards 2021.
Mina CEO and co-founder Ashley Tate said: “No AER formula will ever be able to get close to a fair average pence per mile, as there are too many common extremes in the cost of electricity. Regulatory changes to how energy suppliers buy electricity will make the difference in tariffs even more extreme.
“This means if you pay AER (no matter what the rate), you’ll always be overpaying some and underpaying others.
“I hear a lot of people say the tax benefits make it beneficial, even if the drivers are not being paid enough, as a result of the AER, for their charging, but that doesn’t make it fair.”