Whilst switching from a vehicle with a petrol or diesel engine to an electric vehicle can seem daunting, the reality is that for most people an electric vehicle (EV) is now a very practical and cost effective choice.
In this article we will look at the key points you should consider and what to look for when buying your first EV. We’ll look at the different considerations, and provide an example at the end of the article to help you work out for yourself the difference in cost between a combustion vehicle and an EV.
All figures quoted in this article are for illustration purposes only and should not be relied upon when making any decision to purchase an EV.
How much does an EV cost?
There is no denying that buying an EV usually costs you more upfront than the equivalent petrol or diesel vehicle - sometimes as much as 50-60% more. However, the cost of running an EV can be significantly cheaper throughout its lifetime, with less moving parts meaning services cost less and repairs are far fewer and farther between when compared with their combustion engined counterparts.
How much will it cost me to charge my EV?
The cost of charging your EV will depend on where you charge (either at home, at work, or using public EV charging stations). For example, depending on your home electricity tariff you may be paying around 28p per kWh when charging an EV at home, compared with around 58p per kWh at a public EV fast charging station.
If you’re fortunate enough to have access to solar power or battery storage, this could significantly reduce your running costs even further - check out our article on charging with solar panels for a more in depth look at this topic.
Home charging is usually the cheapest way to keep your EV charged, so why not check out our range of EV home charge points for installation?
What if I have a company vehicle?
More and more companies are beginning to make EV’s available to employees as company vehicles. There are a number of schemes available, but in the most basic arrangement where you receive a company vehicle as a taxable benefit (P11D), you should find that the amount of tax you will pay for an EV is significantly lower than a diesel or petrol, and you will also benefit from the reduced running costs of an EV.
Are EV’s suitable for long journeys?
The current generation of EV’s do, on average, have a lower range than their conventional petrol and diesel counterparts; however, battery technology is improving all the time and the highest range EV’s can now do nearly 400 miles on a single charge (Tesla Model S, Long Range). Also, the number of public EV charge points is also increasing each year, with over 28,000 public charging stations currently in operation in the UK, so topping up on the move is becoming easier all the time.
For most people, an EV can more than handle their day to day needs, but if you’re still worried, check out our article on Reasons your range anxiety is unwarranted.
So, how much will it cost?
In order to work out your costs, you will need to know how many miles you expect to cover each year. In the UK, the average vehicle covers around 12,000 miles per year so we will be using this in our example below.
We’ll be putting two similar SUVs, a Volkswagen ID.4 and a Volkswagen T-Roc, up against each other to show the differences. For both vehicles, we’ll be using the manufacturers quoted specifications for any calculations as well as using the same depreciation (80% reducing balance) and insurance assumptions.
All costs quoted are for illustrative purposes only and should not be relied upon to make any decision to purchase an EV.
Purchasing costs
Volkswagen T-Roc
Volkswagen ID.4
List Price (new)
From £24,175 OTR
From £34,995 OTR
Estimated value in 5yrs
£9,903
£14,334
Loss in value over 5yrs
£14,270
£20,661
Running costs
Volkswagen T-Roc
Volkswagen ID.4
Fuel / Battery Capacity
50 litres
52kWh
Consumption / Range
47.1mpg / 518 miles
4.28 mpkWh / 223 miles
Fuel/charging cost per yr*
£1,930.32
£783.50
Annual Insurance
£529.00
£697.00
First year road tax
£230.00
£0.00
2nd+ years road tax
£165.00
£0.00
Estimated annual servicing cost**
£161.00
£115.00
Total Annual Costs
£2,850.32
(£2,785.32 year 2 onwards)
£1,595.50
Total Running Costs over 5 years
£13,991.60
£7,977.50
* Based on 12,000 miles, and using the RAC’s average petrol price for 2022 (Jan-Aug) of 1.6666p per litre and Casita.com’s average price for domestic electricity of 28p/kWh for the same period.
** Research by EDF suggests EV servicing costs are around 30% lower than petrol vehicles.
Total cost of ownership over five years
Volkswagen T-Roc
Volkswagen ID.4
Loss in value over 5yrs
£14,270.40
£20,661.00
Total Running Costs over 5 years
£13,991.60
£7,977.50
Total cost over 5 years
£28,262.00
£28,638.50
Equivalent total cost per year
£5,652.40
£5,727.70
Equivalent total cost per month
£471.00
£477.31
As you can see, whilst the initial cost of an EV is still significantly higher than a comparable petrol car, there is very little difference in the total cost of ownership over 5 years and the annual running costs of an EV are significantly lower than an equivalent petrol vehicle.
Conclusion
Whilst EV’s aren’t for everyone yet, the reality is that unless you do a lot of high-mileage trips, an EV will likely meet your day to day needs whilst being much better for the planet than a combustion engined vehicle. From a cost perspective, there is very little difference between an EV and a petrol vehicle over 5 years, and with ever improving battery technology it is only a matter of time before EV’s become even cheaper.
