Are you thinking about going for an electric vehicle?
BENEFITS OF GOING ELECTRIC
Once on the road, electric vehicles produce zero CO2. With public chargers using green energy and more eco-friendly electric companies in the UK, it’s become even easier to charge using carbon neutral electricity.
Once you’ve got your electric vehicle you will quickly see the difference in running costs. If you drive in the City you won’t have to pay congestion charges or Ultra Low Emission Zone charges and you’ve also got much lower running costs.
Thanks to the fact that electric vehicles have far fewer moving parts than a traditional internal combustion engine vehicle, you will find that when the time comes to get it repaired, your maintenance costs will be much lower.
If you’re driving a fully-electric vehicle then you will benefit from lower tax costs, not only are you eligible for £0 Vehicle Excise Duty (road tax) but if the car is for the business, then Company Car Tax is just 1% in 2021.
Are electric cars expensive to insure?
When they first came on the market and they were less prevalent on UK roads, insurance companies priced insurance for electric vehicles at around 45% higher than for other vehicles. However, recent research has shown that the price for insuring an electric car has fallen dramatically. In some cases, you will find that your insurance is around 10% higher than it would be for a petrol or diesel car, but prices in the last few years have dropped considerably.
One core reason that was found during the research that contributes towards any higher costs for insurance is the lithium-ion battery that costs more to repair or replace should there be any issues.
Do I need special insurance for an electric car?
Quite simply, no.
You don’t have to take out special insurance for an electric car, standard insurance will cover your vehicle. However, many insurance companies do offer insurance that has been tailored especially for an electric vehicle. These dedicated insurance packages focus on the key concerns that many drivers have when they start driving electric; the battery and the range. The packages will often include battery refurbishment/replacement and the facility to charge your vehicle should you run out of charge while on a journey (think rescue van with a charging point).
What are the costs of having an electric car?
Whether you’re leasing or purchasing your electric vehicle running costs are much lower for it than petrol or diesel equivalents. Though you will still need to fill in the forms annually for your Vehicle Excise Duty, pure electric vehicles with 0 CO2 emissions are not liable for any duty. You will also find that the cost to ensure your vehicle can get you to work or the supermarket is much lower than it would be if you were filling the tank with petrol. Though you may need to charge it more frequently than you would fill your petrol or diesel tank, the costs are considerably lower.
Filling the tank of your petrol or diesel car can be costly. For example, the Audi A3 Sportback has a tank capacity of 50 litres (11 gallons). It can go 64.2 miles to the gallon, so a full tank could travel 706.2 miles (the distance from Brighton to a small village called Lybster in Caithness, Northern Scotland), though only if you are travelling consistently (rather than stuck in traffic) and this would also be running the petrol tank dry. Using the average price of petrol* (122.4p per litre) this one tank of petrol would cost £61.20.
An equivalent journey in an electric vehicle (in this case we are going to use the Tesla Model 3 Long Range Plus with a range of 360 miles to the charge, and an average cost of 3.24p per mile. This adds up to £11.66 per 360 mile charge. So a distance of 706 miles would come to an estimated cost of just £22.87.
As you can see, the difference between these two prices is considerable, £38.33 in fact.
The fact that you don’t have to pay Vehicle Excise Duty and the reduced cost of charging vs filling a fuel tank are just two of the savings you can make, others include:
- Reduced/no company car tax
- No congestion charges
*This price is correct as of 26/02/21
Electric Car Tax
If you have decided to purchase or lease a new electric vehicle then you will be relieved to discover that not only do you have no Vehicle Excise Duty to pay, but if this is a vehicle you have obtained through your company then you will also benefit from incredibly reduced company car tax. In 2020/2021 the BiK (benefit-in-kind) was 0%, in 2021/2022 this will increase, but only to 1%. We have an article all about Company Car Tax, if you would like to find out more about how an electric car could help you to reduce costs.
Electric Car Grants
There are grants available from the Government for electric vehicles as part of their plan for Climate Change.
You will find that if your chosen electric vehicle is eligible for a grant (which, as of 2021* is £2,500) then this will be applied to the price at point of purchase (or lease). However, there are some stipulations attached:
- The OTR (on the road) price of the vehicle must be less than £35,000
- The grant is equal to a maximum of 35% of the vehicle price and a maximum of £2,500
- Only vehicles that have CO2 emissions of less than 50g/km AND can travel at least 70 miles fully-electric
If you’ve already purchased or leased your electric car and you’re now looking to get a charger fitted in your garage or on your drive then there’s a grant for that. Provided by the government and their offices for low emission and zero emission vehicles, the Electric Vehicle Homecharge Scheme is open to applications on the Government website. The available grant is capped at £350 (or 75% of the cost of a charging point) and there are a few criteria that need to be met:
- You must have an electric vehicle
- You have dedicated off-street parking at your property
- The charging point must be installed by an approved installer
If you’re a business owner with some electric vehicles in your fleet then you can apply for a grant towards installation of charging sockets at your workplace. This grant is valued at a maximum of £350 per socket and you can apply for a grant for up to 40 sockets total.
*This data is correct as of 18/03/21