Cost of running an electric car

With no petrol or diesel bills to worry about, are electric cars really cheaper to run? We reveal the cost of running an electric car

John Evans
Feb 10, 2022

If you're intending to buy an electric car, you're probably expecting to save some money along the way. Well you might first need to spend a bit before you start to feel the financial benefits of an electric car, but once those savings start rolling in you might be pleased you made the initial outlay.

There's no doubt electric cars are getting better. With each new model that arrives on the market, the bar is being pushed a little bit higher, whether it's via improved battery range, better on-board equipment, or even just a lower price. There's no doubt as time goes by that electric cars are becoming more and more viable as a replacement for petrol or diesel cars.

Although brand new electric cars are still much more expensive than petrol and diesel alternatives, that gap in price is gradually narrowing, and the growing availability of quality used electric cars makes them even more affordable if you're prepared to opt for a used car.

Perhaps the biggest advancement in the electric car market is the amount of choice on offer. Where you once had the option of a Nissan Leaf, a Renault Zoe, or a BMW i3 if you were looking for a relatively affordable mainstream electric car, they have been joined by the likes of the Peugeot e-208, Vauxhall Corsa-eHonda e, and a whole load of other more affordable and crucially more usable electric cars.

If you aren't open to the used car market, then you can of course make use of the government's plug-in car grant and save some money on a new electric car and enjoy your own little feel-good moment as cost tumbles down. But the most substantial savings are all going to be found in the used car market.

So how much money can you save by driving an electric car compared to a petrol or diesel? Well, that depends on a number of factors we've outlined below. But, if you're opting for a used car, chances are you're going to see those savings far earlier than you are if you decide to buy a brand new one.

Cost of running an electric car vs a petrol car

There’s no escaping the higher purchase cost of electric cars. The huge and advanced battery packs required for each vehicle add thousands of pounds to the price, though these are slowly decreasing in price as production ramps up.

Even with the government’s £1,500 plug-in car grant factored in, the price of a new electric car is significantly more expensive than a petrol or diesel equivalent. An electric version of the Peugeot 208 costs from £29,760 compared with the cheapest petrol version, at £18,645, and the cheapest diesel version at £21,445.

While an increase in demand has pushed up the price of used cars, buying used is still more cost effective than buying brand-new, not to mention the significant environmental benefits of not manufacturing a brand-new car.

It’s best to recharge electric cars from a dedicated charging point, which is both faster and safer than a three-pin plug. Expect to pay anywhere between £500 and £1,500 for one of these.

You should also consider the tax benefits of going electric: while cars registered after 2017 command some of the highest tax rates, electric cars are free to tax. They are also exempt from the surcharge that typically applies to car that cost more than £40,000 when new.

Data from insurers shows that electric cars are less likely to be stolen than the average vehicle and more likely to be owned by responsible drivers. This helps to keep insurance premiums low, although the latest crop of powerful EVs are likely to cost more to insure.

Despite their sometimes complex lightweight materials and advanced internal technology, there are fewer moving parts in an electric car compared with a regular petrol, diesel or hybrid car, so you should be pleasantly surprised when it comes to servicing. There are no costly timing belt, expensive oil change or fiddly spark plugs, for example.

Some manufacturers, like Tesla, don’t even have a formal servicing schedule, and recommend that components like brakes and fluids are replaced and topped up as required.

Mark Jowsey of KeeResources, a supplier of vehicle maintenance data to fleet operators, says electric cars are at least 30% cheaper to service and maintain than their petrol and diesel equivalents. What’s more, the gap widens over time and mileage as petrol and diesel cars require more replacement parts.

“Another factor to consider is brake life,” says Jowsey. “Replacement brake pads and discs are a major expense but an electric car’s regenerative braking system takes a lot of the strain, meaning their pads and discs generally last much longer.”

However, only a limited number of garages can work on electric cars because specialist knowledge is needed to work safely on their high-voltage systems. This means that you're generally restricted to main dealers, which tend to charge more than independent mechanics.

If you intend to keep your car for many years, you may want to pay attention to the battery-specific warranty offered by the manufacturer. As with your phone’s power pack, an electric car’s batteries will degrade over time but manufacturers typically guarantee their performance for eight years. If the battery pack loses a certain amount of its capacity, then it will usually be repaired or replaced.

Some models are proving even more resilient. In 2016, a group of Tesla owners monitored 286 of their members’ cars and found that over 200,000 miles, a battery was likely to lose no more than 5% of its capacity. There’s even one Model S in Europe that’s said to have been driven for more than 1,000,000km (621,370 miles) using the same battery.

Below is a comparison of the running costs of two similar models, assuming the following:

  • Ownership over four years
  • Annual mileage of 10,000 miles
  • 30-year-old married male driver living in Cardiff, no children, working as a teacher
  • Cheapest non-black-box policy
  • Petrol price of 142.9p/litre, off-peak electricity price of 7.5p/kWh

Peugeot e-208 Electric 50kWh Allure Premium

Power 136hp
Gearbox automatic
Efficiency 3.9 mi/kW
Insurance group 27E

Used deals Limited stock

Peugeot 208 PureTech 130 Allure Premium EAT8

Power 130hp
Gearbox automatic
Efficiency 51.9mpg
Insurance group 24E

Used deals Limited stock

Peugeot e-208Peugeot 208
Total insurance cost £2,408.40 £2,160.04
Total fuel cost £769.24 £5,000.12
Total servicing cost £418 £1,046
Total tax cost £0 £645
OVERALL COST£3,595.64£8,851.12

Additional electric car running costs

If your electric car is provided by your employer, you’ll pay less company car tax than if it were petrol or diesel.

Fail to make use of cheap electricity tariffs and you could find yourself paying significantly more to charge the car's battery. Similarly, avoid public chargers (especially rapid chargers) to see the biggest savings.

  

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